Cocoa under pressure from a looming recession?

On the cocoa market, we observe another negative opening. The price opened with a gap of about 1%, near the upward trend line based on the lows from May and June. It is important to remember that cocoa is usually under pressure during recession periods. The last recession in 2020 (or rather just before the recession, during the global asset price pullback in February-March 2020) led to a 25% price drop.

The breakout range of the small triangle is 6700, while the key technical support is at 7000. However, it is worth noting that both levels are likely to be breached due to the upcoming roll-over on August 7th. This roll-over will amount to about $1000, and given the current state, the price should open at around $6400. Nevertheless, if the market were to experience a true recession, one cannot rule out the completion of the large triangle formation, which suggests a drop to as low as $4500 per ton. This would be the lowest level since January.