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.
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