Technicals

U.S. benchmarks have continued their rebound from last week’s healthy pullback. After a quiet overnight session, the S&P is staring down the barrel at its all-time high. The Nasdaq has already set a fresh record for the second straight session. 
Cocoa continues its recent downtrend, a trend which was accelerated after Fed Chairman Jerome Powell announced that a rate hike would come sooner than expected for the U.S.
A very minor shift in the Fed’s rate hike expectations has roiled risk assets and strengthened the U.S. Dollar. Via their dot plot, committee members now anticipate 2 rate hikes through the end of 2023. 
Fridays have typically been strong when such green lights have emerged and although stocks finished higher, it was broadly a lackluster session. What changed?
This week builds up into Thursday’s monumental inflation data, ECB meeting, and Initial Jobless Claims. Portfolio managers and traders want to be long risk assets such as stocks and commodities, but fear inflation that has begun to run hot.
Looking at a July cocoa chart, you can see the lack of direction. After a recovery in May, most of the rally has been given back. Recent consolidation has traders confused on cocoa’s next move. 
U.S. benchmarks are now pointing lower and working their way through supports ahead of the bell. Despite exuding a bullish tone, we’ve warned that an inability to hold higher prices will encourage a probing lower.
What type of month-end flows will we see? How does this setup for June? Plus, the data gauntlet also includes the Fed’s preferred inflation indicator, the Core PCE Index, tomorrow.
U.S. benchmarks are pointing higher ahead of Monday’s opening bell, but our rare major 4-star ceiling won Friday’s battle and again overshadows today’s early strength.
July cocoa has continued to move lower over the past few sessions. Traders have experienced a choppy few weeks of trading after a small “V” in the chart. Demand is slightly on the rise as more easing occurs in the UK and the U.S.