SINGAPORE, April 8, 2011 - Second month London cocoa is expected to end the current fall above 1,798 pounds per tonne and rise to 2,400 pounds over the next four weeks.
The long-term uptrend is still intact, despite a second sharp dip towards a key support at 1,827 pounds, the 38.2 percent Fibonacci retracement on a wave (3) rise from the Aug. 2005 low at 795 pounds to the July 2010 high at 2,465 pounds.
The uptrend could have resumed at the Nov. 2010 low of 1,798 pounds after a wave "i" of the wave (5) developed, and the current fall is labeled as a wave "ii", to be followed by a wave "iii" targeting 2,400 pounds or higher.
A fall below 1,798 pounds may not travel very deep, extending only to 1,758 pounds, from which, the uptrend will resume.
** 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. **
Source : reuters
