CSCE cocoa futures jumped nearly 4.6 percent on Tuesday to its highest level in six sessions on short-covering by speculators in a thin market with supportive spread trade, brokers said. "We went up on speculative buying. Volume was light. There was some selling between $1,575 and $1,580, but nothing from $1,585 to $1,600. London jumped up 20 pounds very quickly," said one broker.
Traders said the market was oversold on Monday, which set Tuesday's firmer tone.
"Some chart points were triggered on the way back up today after yesterday's lack of follow-through on the downside," said one trader.
The benchmark March cocoa contract sprinted up $70 to close at $1,600 a tonne, with a $1,548-$1,605 range. The $1,605 intraday high was a six day peak coming on the heels of hitting a 4-week low on Monday.
Foreign-based pod counters said last week that Ivory Coast's main cocoa crop (October-March) is expected to reach some 1,060,000 tonnes, higher than forecasts by local officials.
May cocoa tacked on $64 to close at $1,590 while the back or deferred months settled $62 or $65 a tonne higher.
Floor brokers said there were some 2,165 switches or spreads that traded Tuesday with 800 March/May switches traded and 400 May/September switches.
Comments
Comments are closed.