After trending higher throughout 2014 and reaching a high of 3300 on the December contract, Cocoa (CC) is currently pulling back.
The pullback has brought the price below 3045, a region which provided support throughout the sideways months of June and most of July.
Cocoa Futures (CC) Daily Chart, December Contract
On September 9 the price ducked below this level, and then quickly rallied back above it, likely triggering a bunch of stop loss orders before the buying kicked back in. While the pullback to the level does signal the uptrend is weakening, it doesn't mean it's over. If this support region holds, look for the price to move back to the 3200 region, and if it can get through there, re-test the 3300 high.
If giving the uptrend the benefit of the doubt, a stop loss can be placed below 3030 (giving a bit of room) which is the September 9 low.
If more bearish on Cocoa, wait for a significant break of 3045-3030 support, and then look to enter short on a retrace higher (likely to be covered in a future post if this situation develops). The short trade requires more confirmation since the uptrend is up and support has held as of this writing on September 9.