Cocoa Futures (ICE) – Long Trade Setup

🍫 Cocoa Futures (ICE) – Long Trade Setup

Direction: Long Bias
Contract: Cocoa (NY / ICE)
Current Price: ~7,437

🔍 Technical Setup

Price has been consolidating after the sharp run-up and has now pulled back into a key long-term trendline (yellow support).

A downtrend channel breakout is forming – if price clears this, it opens the door to a relief rally.

I’m looking for price to push back toward the 8,500–9,000 zone as a first target (previous structure resistance).

EMA cross (9 vs 19) is flattening, signaling potential shift in momentum.

📊 COT & Sentiment

Speculators remain net long in cocoa, reflecting continued bullish sentiment.

Commercials (hedgers) are still short, but that’s typical for producers – nothing extreme.

Fundamentals remain tight:

Black pod disease in Cameroon hitting yields.

Stockpiles in London/NY at multi-year lows.

Consumer demand holding up despite high prices.

This alignment supports a bullish recovery if technicals confirm.

🎯 Trade Plan

Entry: Current levels around 7,400–7,500, scaling in on confirmation.

Target 1: 8,500 (previous resistance zone).

Target 2: 9,000+ if momentum extends.

Stop Loss: Below 7,000 to protect against breakdown.

Risk/Reward: ~1:2 setup.

⚠️ Risks

Stronger-than-expected supply recovery in Ivory Coast/Ghana.

Weak grind demand data (sign of demand destruction).

Speculators cutting long positions aggressively.

✅ Conclusion

Cocoa has pulled back into long-term support, with positioning and fundamentals still supportive of higher prices. If the descending trendline breaks, I’m positioning for a long swing toward 8,500–9,000.

This cocoa strategy has a profitability rate of 66% and average 9.4% gain on a long position.