Just a reminder, these charts are posted as examples of the trades on the nightly COT Signals email. These trades will help illustrate the mechanics that go into creating the nightly email.
Commercial traders have added to their short positions at an increasing pace during the month of June. This can be seen in the parabolic nature of the negative build in commercial momentum. This build in commercial short positions may be based on the fact that July and August are cocoa’s weakest months.
Given the preceding criteria, we are selling september cocoa during its bounce off the initial support at 2910, which we expect to fail. We will also be placing a protective buy stop 3144, the swing high. Our trading methodology requires that we place protective stops on all positions.
Please call with any questions.
Andy Waldock
866-990-0777