The price of cocoa
could double by 2020 on rising demand for chocolate out of Europe. For years, cocoa
has been weak because Europe consumers have been beaten down by the slowing European economy. Now, with ECB QE
showing signs that it's helping turn the corner for Europeans, and with massive amounts of inflows into European stocks
in anticipation of a rebound, cocoa
could be an excellent long play. Chocolate is a consumer discretionary/cyclical product so if you believe Europe is in a recovery, this is a trade you may want to consider.
The chart of the cocoa ETN
NIB shows an excellent oversold swing long entry off a double bottom
reversal, with a nice clear stop loss level just below the double bottom
in case the trade goes against us.