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Bullish Demand For Cocoa


In the space of 1 1/2 weeks, cocoa has seen a downside breakout to a potential upside breakout of its December/February consolidation zone. As market focus shifts towards a stronger demand outlook, cocoa can extend this recovery move.


Coffee prices are more than 14.00 cents above their mid-February lows and are likely to climb further to the upside over the next few weeks. Given their price action, however, the market may be setting up for a near-term pullback.


Industrial commodities (cotton, lumber and copper) all drove to new contract highs again yesterday as the reopening of the global economy and expectations for strong economic growth are all seen as bullish forces. May cotton has closed higher for nine straight sessions and the market has posted another new contract high this morning.


Sugar prices found their footing, but they may be heading for a volatile end of February. While the market should maintain its uptrend, sugar may see volatile price action.

Futures and options trading involve significant risk of loss and may not be suitable for everyone.  Therefore, carefully consider whether such trading is suitable for you in light of your financial condition.  The information and comments contained herein is provided by ADMIS and in no way should be construed to be information provided by ADM.  The author of this report did not have a financial interest in any of the contracts discussed in this report at the time the report was prepared.  The information provided is designed to assist in your analysis and evaluation of the futures and options markets.  However, any decisions you may make to buy, sell or hold a futures or options position on such research are entirely your own and not in any way deemed to be endorsed by or attributed to ADMIS. Copyright ADM Investor Services, Inc.

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