Cocoa Futures Move Lower On Coronavirus Fear Mongering

Cocoa futures continue move lower as fears grow coronavirus gets worse
May Cocoa futures contract found support at 2725
Cocoa traders monitoring how Asian grinding data will fair moving forward
Cocoa Futures Update

Cocoa Futures Update

Cocoa Futures Move On Coronvirus Economic Impact

May cocoa futures continue to move lower as fear grows that the coronavirus outbreak could continue to get worse. Until a vaccine is in place, which could be six weeks away, the threat of a growing number of cases will continue. The virus could impact the demand of the soft in Europe and Asia. Grinding data will provide guidance as it is released.

 

Technical Outlook In Cocoa

In the short-term, the Euro and Pound have stayed strong, providing some support to prices. On Wednesday, the May contract found support at 2725. As news breaks, the technicals could be pushed to the side and have little impact on trading.


Looking Ahead

The weather in West Africa will also be monitored, light rain is expected in the near-term, but this may not affect prices if the accumulation remains minimal.

Traders will need to look at positions on a day-to-day basis since the future is unknown of how large the number of the coronavirus cases could get.

Price Chart of Cocoa Market

Cocoa Futures Chart
Source: Tradingview

 

If you are interested in discussing the soft commodities further contact pmooses@rjofutures.com . 

About the Author

Peter Mooses is a commodity broker at RJO Futures. He enjoys the analytical aspects of futures trading and appreciates the economic impact that commodities have across all markets.