As we head into Thanksgiving and the holiday schedule, cocoa has moved lower. After making new highs the market has turned volatile. The current channel looks negative..
The rally in Cocoa futures higher this week is all technical. Once 2560 price level broke, 2600 was the next price level traders needed for the market to close above.
December coffee futures have entered some consolidation. After the lows made in August and September, the futures contract tried to trade above 104.00 but that couldn’t hold.
December cocoa futures are sitting on support. 2455 has held multiple times on the chart and has helped the contract recover back to the 2550-2600 range.
It appears the lows may have been put in the December cocoa futures contracts. Although the contract has hit overbought levels, the technicals and fundamentals are working together to get prices back to 2500.
December cocoa futures are attempting to rally but technically 2300 continues to be a level of resistance. Today’s close, above the 9-day moving average, should trigger follow-through on this recent move higher.
