Cocoa Short Had an eye on this one for a while and there've been a few points I thought we might be making a high in this but so far taken no action on it (Which has proven wise).
Now we have a strong confluence of sell signals, though. We have the potential AB=CD topping patterns and this comes in at the 1.61 head fake level.
See strategy info here:
1.61 head fake is an optimal spot to short what may be the end of a parabolic trend. It's not a sure fire signal (By any means) but it allows for the defining of a small zone in which to make high RR bets.
Taking a short in this area now.
COCOA trade ideas
USCOCOA - Swing Long Trade Opportunity?CAPITALCOM:USCOCOA Over the past 11 months, each time the RSI has dropped to the 30 level, it has consistently triggered a reversal, followed by new upward trends. Given that the price is currently 42% below the ATH level, this might present a promising long trade opportunity. If it breaks above the 100-day EMA, I anticipate further gains.
Ivory Coast Expects Cocoa Rebound Next Season on Better Weather
Country expects to harvest 2 million tons in 2024-25 crop year
Futures prices have dipped on improved cocoa crop outlook
Ivory Coast’s cocoa output is expected to rebound next season — helping ease a global supply squeeze that pushed prices past records — as the world’s top grower banks on better weather.
The West African producer is likely to harvest 2 million tons of the chocolate-making ingredient in the 2024-25 crop year that starts Oct. 1, according to people familiar with the matter, who cited early pod counting.
The outlook for the upcoming year compares with the 1.8 million tons the International Cocoa Organization estimates the country will harvest by the end of the current season in September. Ivory Coast’s output averaged 2.2 million tons in the five years before 2023-24.
The country has already sold 800,000 tons of the 2024-25 harvest on the forward market, the people said, asking not to be named because they were not authorized to discuss the matter. However, they added forward sales have since been paused by the industry regulator Le Conseil Cafe-Cacao.
The CCC plans a combination of forward and spot sales in the future, as part of a marketing reform.
A mix of bad weather, disease, and aging trees in top growers Ivory Coast and Ghana drove this season’s slump and saw New York cocoa futures soar past $11,000 a ton earlier this year.
Prices have since eased on optimism about improving weather conditions in West Africa. Ghana is also expecting a better crop next season.
Ivory Coast is also cracking down on the smuggling of cocoa beans to neighboring countries which will help boost supplies, said the people. An estimated 200,000 tons of beans were smuggled this season, they added.
A spokesperson for the CCC declined to comment when contacted by phone on Friday.
after the return to normal...The inévitable dump on cocoa futures is coming.
After the market got cornered following poor weather conditions for growing this crop, be ready for a giant plummet back to 'normal' cocoa prices. Shorting these futures will be very popular in a few weeks from now for months to come.
COCOA- Multi-year Long setupCOCOA has been in a consolidation pattern for multiple years now. Testing lower side of the pattern and upper side, now it's in a very confined range and the upper/lower resistance/support line are coming to agreement. It is trading above resistance now and this would make an ideal long-entry when buying the pullback on the now broken resistance line around 2675~2750. Targets are 4130 ~ 4670.
COCOA BULL RUN STILL EAGER FOR MORE UPSWINGOn Wednesday, April 24th, the bullish gap opening price indicated a strong bullish sentiment for #Cocoa. However, the price faced rejection at the 61.8% Fibonacci retracement level, which coincided with the previous week's bar high on April 8th, 2024. A strong bullish close above 12265 by the end of this week would signal the continuation of the bullish trend for #Cocoa.
COCOA about to crashNot much of a technical analysis as we can see but there is not much we can do about it. The chart is just parabolic due to the high amount of big companies hedging against the worse-than-expected harvest. The fundamental analysis could not be much of a help either because nothing can resonate with such pricing for the cocoa. This type of trade is just speculative because it has a decent Risk-Reward.
Stops above the previous high
TP between 7,000-7,600$
Do you like chocolate? Buy here.If you are interested to trade COCOA, which was in ATH few days ago, I´m suggesting to wait 5325 looks like a good entry level. BUT, please don´t use entry line as a trigger. Use REACTION on that line as a trigger. What does it mean? Price is going to fall there, most likely even below. When you see an aggressive close back ABOVE the entry line, enter and set SL. Don´t fall to the trap by buying lower(because of more favorable price). You can get trapped. Price will be more "favorable", but you will make your trade much riskier this way. Set alarms at the entry line and start to monitor the asset on 15-30M TF when alarm is triggered. If you follow me, I will try to update this trade, when my alarm rings. Wish you good luck.