SINGAPORE: New York May cocoa faces a resistance at $2,559 per tonne and may hover below this level or retrace towards a support at $2,492.
The resistance is at the 200 percent projection level of an upward wave C from $1,991. The bearish divergence on the hourly RSI suggests dissipating bullish momentum. Without a consolidation, the contract may not retest the resistance.
A break below $2,492 could cause a loss to $2,451 while a break above $2,559 could confirm the extension of the wave C towards $2,626.
Note: Cocoa report will be published twice a week, on Wednesday and Friday.
Wang Tao is a Reuters market analyst for commodities and energy technicals. The views expressed are his own.
No information in this analysis should be considered as being business, financial or legal advice. Each reader should consult his or her own professional or other advisers for business, financial or legal advice regarding the products mentioned in the analyses.
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