NY 2nd Month Sugar Futures
NY sugar softened on Friday as the futures struggled to break above 40 DMA; the 10 DMA support still held firm, and the futures closed at 17.68. On Monday, the long-term support at 17.50 was broken below to 17.00, the lows not seen since June 2021. The stochastics highlight today’s weakness, with the %K/%D diverging on the downside and the MACD being negative and diverging. For the weakness to prevail, the support at 17.00 has to break completely before we can see lower lows. On the upside, the futures would need to break resistance levels at 17.50 and 17.62 to come back to levels trading last week. We expect the futures to remain low, but the support at 17.00 should hold today.
Ldn 2nd Month Sugar Futures
Ldn sugar futures once again struggled to break below the 487.60 level on Friday, but resistance at 10 DMA is edging closer and is capping any upside momentum; the futures closed at 492. The indicators suggest that a strong buy signal is approaching, with %K/%D converging on the upside and now rising out of the oversold. Likewise, the MACD diff is negative and converging. To confirm this, the futures need to break above the resistance at 10 DMA at 495.65 before retesting the 500 level. On the downside, if the 10 DMA resistance holds firm, we would expect the prices to test 487.60 before 480. The indicators point to higher prices in the near term, but to confirm this, the futures need to break above the 10 DMA in the near term.
NY 2nd Month Coffee Futures
NY coffee futures weakened on Friday, but support at 212.60 and the futures closed above at 212.55. The stochastics have converged on the downside, and the MACD diff is negative and is beginning to diverge on the downside once again. The rejection of the support level at 212.60 could set the scene for 209.65 before the 202.30 levels. Alternatively, a break above the resistance at 10 DMA at 217.45 could lead to the 40 DMA at 221.60. The prices have been trading range-bound in recent weeks, but to confirm the indicators’ momentum on the downside, the futures need to break below the 212.60 level first.
Ldn 2nd Month Coffee Futures
Ldn coffee weakened on Friday as protracted selling pressure triggered a close on the back foot at 2146. The stochastics are falling further into the oversold, which could suggest we could see a change of trend after some weakness. The MACD diff is negative, however, it lacks the conviction to suggest an outlook. A full bearish candle suggests growing selling pressures; this could set the scene for lower prices to break below the 2150 level. This would confirm the trend for falling prices, down to the 100 DMA at 2112. On the upside, resistance at 10 DMA at 2198 has proven to be strong, and support above that level would strengthen the bullish momentum. This could also trigger gains towards 2215. The strong bearish candle suggests a continuing market downturn, but the indicators suggest that the level is oversold, so we could see support form at current levels.
NY 2nd Month Cocoa Futures
NY cocoa futures strengthened on Friday as protracted buying pressure triggered a close on the front foot at 2340. The RSI is rising, while %K/%D is diverging on the upside. Likewise, the MACD diff is negative and converging. On the upside, finding support above the 40 DMA level at 2364 could trigger gains through 2400 towards 2420. On the downside, a break below the 10 DMA at the 2305 level could trigger losses back towards 2236. That level has been supporting futures prices, and a break below it would signal strong selling pressure. Longer upper wick signals that the futures have tested the 40 DMA but then came back to lower ranges on the day. We expect the futures to struggle above this level as they continue to trace the descending triangle formation.
Ldn 2nd Month Cocoa Futures
Ldn cocoa futures held the nerve on Friday as trading saw prices close above 1900 at 1905. The stochastics are seen diverging on the upside, with the %K/%D edging further into the overbought, and the MACD diff is positive and diverging. A break back below 1900 could trigger losses through 1850, with the tertiary level at 1837. On the upside, a break above 1930 could set the scene for bullish momentum towards the 1950 level. The spinning top formation has been formed, which points to market indecisiveness, however, the futures have struggled above 1930 in the last couple of days, and we expect to see the downside momentum grow in the near term.
