Cocoa: Ghana will no longer export cocoa to Switzerland

Mthokozisi Mpofu Knars Capital

Fundamental outlook

Ghana is Switzerland’s biggest trading partner in sub-Saharan Africa having produced about 812 thousand tons of cocoa bean in 2018/2019.

The Coffee Cocoa Council (CCC) and the Ghana Cocoa Board (Cocobod) in a statement said the two of the world’s top chocolate sellers were not paying the living income differential (LID).

Ghana has moved towards processing its cocoa. The world and Switzerland will experience a massive shortage since Ghana is responsible for about 45% of the world’s cocoa.

Technical outlook

The chart below shows Cocoa the public would assume after such an announcement that we would see an increase in the price of Cocoa but that is not what we are seeing at the moment.

We foresee more downside pressure to around 2480.4 and 2465.4 before we see a move higher above 2702.3. 2480.4 is also the 61.8 Fibonacci retracement level of our previous impulsive move higher.

The current count has us in a corrective zigzag expecting lower levels despite the fundamentals which came out. Ideal entry points would be on a break of wave (b) targeting 2702.3.

No key news events to look out for this week.

Res: 2597.8; 2616.2; 2661.3.
Sup: 2500.0: 2465.4; 2400.0.

Author

Mthokozisi Mpofu

Knars Capital

Mthokozisi Mpofu is the Managing Director of Knars Capital Pvt Ltd, an investment advisory firm helping African SMEs secure growth capital and become investor-ready.

AUD/USD hangs near three-week low, below 0.6950 as traders await US NFP report

AUD/USD hits a three-week low during the Asian session on Friday as the RBA’s dovish shift and a rout in equity markets weigh on the risk-sensitive Aussie. However, the recent slump in US bond yields to a two-month low keeps US Dollar bulls on the back foot and limits losses for the currency pair as traders look to the US NFP report for a fresh impetus.

USD/JPY bounces off three-week low; keeps the red near 157.65 as focus remains on US NFP

USD/JPY bounces off the weekly low set during the Asian session, as bears turn cautious ahead of the US NFP report due later this Friday. The upside seems limited as the recent slump in US bond yields and hopes of Iran war de-escalation undermine the US Dollar. Moreover, a hawkish BoJ and intervention risks support the Japanese Yen, capping the pair.

Gold loses the grip; $4,000 comes next on the downside

Gold sets aside two daily advances in a row on Friday, opening the door to a potential test of the key $4,000 mark per troy ounce. The precious metal’s retracement follows a decent improvement in the sentiment surrounding the US Dollar, solid NFP data and higher US Treasury yields across the board.

Democrats win House and Senate in US midterms: Why isn’t all bad news for crypto

The biggest story this week was Tuesday’s US midterm elections, which saw Democrats win control of both the House and the Senate in a clear blue wave. This political shift in the US has triggered sharp price swings across the cryptocurrency market.

Week ahead – Inflation and geopolitics in focus as US political landscape shifts

Post-midterm election euphoria fizzles out as risk aversion prevails. US CPI, PPI and Fedspeak on the radar as Fed hike bets remain supported. Oil retreat pauses on mixed hopes about the ongoing conflicts.

US Dollar breaks below 101.50 as Democrats sweep Congress

The US Dollar (USD) comes under heavy selling pressure on Wednesday, with the US Dollar Index (DXY) falling around 0.5% to trade near 101.35 after sliding below the 101.50 level. The Greenback retreats to its lowest level in four weeks as investors reassess the political and economic outlook following the Democratic Party's sweeping victory in the United States (US) midterm elections.