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.
We got two new headlines last night, one that said the U.S. would delay the increase in tariffs until October 15th. The other was that Taiwan would step in and buy 3.6 billion dollars in American agricultural products.
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.
Grain trader's attention will now turn to Thursday’s USDA report. Bolton fired and the next headline that says the US and China will be meeting to discuss trade (which is inevitable) will suddenly carry a little more weight.