Cocoa Technical Analysis Summary
Above 2500
Buy Stop
Below 2270
Stop Loss
| Indicator | Signal |
|---|---|
| RSI | Neutral |
| MACD | Buy |
| MA(200) | Buy |
| Fractals | Buy |
| Parabolic SAR | Buy |
| Bollinger Bands | Buy |
Cocoa Chart Analysis
Cocoa Technical Analysis
On the daily timeframe, COCOA: D1 went up from the neutral channel. It exceeded the 200-day moving average. A number of technical analysis indicators formed signals for further growth. We do not rule out a bullish movement if COCOA: D1 rises above its most recent high of 2500. This level can be used as an entry point. The initial risk limit is possible below the Parabolic signal, the 200-day moving average line and the last 2 lower fractals: 2270. After opening a pending order, we move the stop following the Bollinger and Parabolic signals to the next fractal low. Thus, we change the potential profit/loss ratio in our favor. The most cautious traders, after making a trade, can switch to a four-hour chart and set a stop loss, moving it in the direction of movement. If the price overcomes the stop level (2270) without activating the order (2500), it is recommended to delete the order: there are internal changes in the market that were not taken into account.
Fundamental Analysis of Commodities - Cocoa
West Africa is at risk of an outbreak of black pod disease. Will COCOA quotes continue to rise?
This disease is caused by the fungus Phytophthora palmivora during the rainy season with relatively low temperatures, high humidity and lack of sunlight. An additional negative for the cocoa crop may be a shortage of fertilizers and pesticides against the backdrop of rising world prices. About 75% of the world’s cocoa is grown in West Africa. The Ivory Coast government reported that since October 1 this year, 295.4 thousand tons of cocoa beans have been delivered to seaports. This is 20.6% less than last year’s level. Exports of cocoa from Nigeria in September 2022 decreased by 16% y/y and amounted to 11.1 thousand tons. Previously, the Ghana Cocoa Board predicted a cocoa harvest in the 2022/2023 season in the amount of 850 thousand tons. Last week, a number of Western banks announced their estimates of the cocoa harvest in this African country, which turned out to be noticeably lower.