Cocoa's price has doubled over the past two years, with much of that gain coming just this year (from nearly 2000 per metric ton in January to 3147 today). The meteoric rise has people talking optimistically about prices (but only if you aren't a chocolate addict.)
Marketwatch.com had this to say on Cocoa last night:
"Cocoa futures rose to their highest level in at least 24 years Tuesday, as dry weather in major cocoa-producing countries cut global supplies."
The consensus of market-watchers and the media is that this year's harvest will drive Cocoa prices — in turn, their logic dictates that the bleak global weather outlook means Cocoa prices will continue to rise. Cocoa's future seems cut and 'drought'-dried.
The path may seem clear for Cocoa, but Elliott Wave International's Senior Commodities Analyst Jeffrey Kennedy isn't convinced. His
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Jeffrey's technical analysis is more than a different interpretation: He shows just how much more there is to the story. In the May 29 Daily and June Monthly Futures Junctures, Jeffrey called for a sizable advance in Cocoa into a precise range of resistance. This chart from Monthly Futures Junctures shows that Cocoa prices have done just what Jeffrey said they would, and now stand at a critical juncture in the middle of Jeffrey's range.
The next few days will be key for Cocoa's direction over the next several months. So the question is… Then what?
Futures Junctures Service offers technical analysis on Cocoa and almost two dozen other commodities markets, with concise answers to the "Now what?" questions.
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