Nations in West Africa are likely to have sold as many as 250,000 metric tons of the soft commodity during the past two-plus weeks, futures and options brokerage Marex Spectron Group of London said on Monday. The Ivory Coast is the globe's top grower and shipper of the soft commodity, trailed by Ghana. The performance on Tuesday comes after the commodity endured losses as high as 1.3 percent.
"Cocoa collapsed yesterday because speculators bought more – mostly covering shorts – than initially thought," states a Tuesday email to Bloomberg authored by agriculture options brokerage Eric Sivry with Marex Spectron. "With origins having sold a lot recently, selling pressure has been slightly removed."
At 9:22 a.m. on Tuesday, cocoa futures rose 1.69 percent, a $39 lift to $2,349 per metric ton.
The Business Recorder reports cocoa futures endured their sharpest losses in one month on Monday, which came after the soft commodity had pushed to its top price in about 120 days just last week.
This material is conveyed as a solicitation for entering into a derivatives transaction.
This material has been prepared by a Daniels Trading broker who provides research market commentary and trade recommendations as part of his or her solicitation for accounts and solicitation for trades; however, Daniels Trading does not maintain a research department as defined in CFTC Rule 1.71. Daniels Trading, its principals, brokers and employees may trade in derivatives for their own accounts or for the accounts of others. Due to various factors (such as risk tolerance, margin requirements, trading objectives, short term vs. long term strategies, technical vs. fundamental market analysis, and other factors) such trading may result in the initiation or liquidation of positions that are different from or contrary to the opinions and recommendations contained therein.
Past performance is not necessarily indicative of future performance. The risk of loss in trading futures contracts or commodity options can be substantial, and therefore investors should understand the risks involved in taking leveraged positions and must assume responsibility for the risks associated with such investments and for their results.
You should carefully consider whether such trading is suitable for you in light of your circumstances and financial resources. You should read the "risk disclosure" webpage accessed at www.DanielsTrading.com at the bottom of the homepage. Daniels Trading is not affiliated with nor does it endorse any trading system, newsletter or other similar service. Daniels Trading does not guarantee or verify any performance claims made by such systems or service.