SINGAPORE: New York December cocoa may test a resistance at $2,238 per tonne, a break above which could lead to a gain to the next resistance at $2,299.
These resistances are identified respectively as the 61.8 percent and the 76.4 percent retracements of the downtrend from $2,397 to $1,982.
It is doubtful that cocoa could break $2,238, as this resistance itself would be strong enough to trigger a deep correction. Marking this barrier stronger is another similar one established by a falling trendline. Most likely, the contract could temporarily peak around $2,238.
A break below $2,190 could cause a loss to $2,141.
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** 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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