1. Soft Commodities Outlook
  2. Softs Technical Charts

NY 2nd Month Sugar Futures

NY Sugar 05102022

NY sugar edged higher yesterday as intraday trading caused futures to test appetite for prices above 17.00 after the previous day’s sell-off to current lows; the market closed at 17.14. Stochastics are falling, with %K/%D diverging on the downside. The MACD diff is negative and diverging, suggesting growing selling pressure despite yesterday’s candle. To confirm negative momentum, prices need to close below Monday’s lows at 16.68 and then target 16.50, which is also the June 2021 lows. On the upside, the rejection of prices above 17.15 could trigger gains back to 17.48 before targeting the 10 DMA at 17.57. Buying pressure from yesterday’s candle suggests a slight appetite for prices above 17.00, but indicators point to further downside in the near term. The reaffirmation of resistance at 17.15 could strengthen the outlook for lower prices.

Tables 1 (219)

Ldn 2nd Month Sugar Futures

Ldn Sugar 05102022

Ldn sugar futures gained ground once again yesterday, testing the prices above 495.80 to close at 495.30. The stochastics have converged on the upside in the oversold and are now rising, as the MACD diff is negative and converging on the upside. This suggests that the indicators point to growing bullish momentum in the near term, and if prices break above 495.80 before testing the 500 level, we could see stronger upside momentum to 512.90. On the downside, the candle found support at 487.60, and if the prices break through this level, we could see futures retreat back through 480. The bullish candle with a longer upper wick after a similar bullish candle points to growing uncertainty about breaking out of the current resistance and support levels. The indicators suggest a strong bullish signal, but resistance at current levels has to be confirmed first.

Tables 2 (218)

NY 2nd Month Coffee Futures

NY Coffee 0510222

NY coffee futures edged higher yesterday as support at 208 held firm. The futures, however, were capped at the 10 DMA resistance level, causing the prices to close at 214.62. The stochastics continue to fall, but %K/%D are seen converging on the upside out of the oversold area, and the MACD diff is negative and is showing signs of convergence, suggesting waning weakness in the near term. This could cause the futures to test the 10 DMA level at 214.62, but before this, the near-term resistance at 212.60 must be broken first. On the downside, the 206.50 level stands firm for now, but if the futures gain enough conviction to break below these levels, this could trigger a test of 202.30. The indicators indicate waning downside momentum in the near term, but the inside candle formation suggests further weakness in the near term. To confirm the indicators’ moves, the resistance at 212.60 must be broken above first.

Tables 3 (218)

Ldn 2nd Month Coffee Futures

Ldn Coffee 05102022

Ldn coffee futures opened higher day-on-day but lost marginal ground to close at 2163. The %K/%D are seen converging on the upside in the oversold. The MACD diff is negative and converging, suggesting a growing appetite for higher prices in the near term, but futures need to break above the robust resistance levels of 10 and 40 DMAs at 2192 and 2223, respectively, to trigger the momentum. Prices would then need to take out the 2281 level to confirm the longer-term momentum. Conversely, appetite for prices below 2160 could trigger a test of support of 2143. A doji candle shows a lack of momentum for higher prices, especially with the 10 DMA capping upside momentum. However, the indicators being oversold could confirm the change of momentum in the near term.

Tables 4 (219)

NY 2nd Month Cocoa Futures

NY Cocoa 0510222

NY cocoa futures gained ground yesterday but struggled above the trend resistance once again to close at 52351. The stochastics are continuing to diverge, with the %K/%D rising on the upside, as the MACD diff is positive and diverging. This suggests we could see a continuation of upside momentum in the near term. To confirm this, prices need to break above the 40 DMA at 2363. If the prices break through this level, we could see prices gain momentum through 2400. On the downside, a break below 2314 and 2300 could signal downside potential. The bullish candle with a long body and longer upper wick suggests that the long-term resistance remains intact, and we could see the futures struggle above it.

Tables 5 (217)

Ldn 2nd Month Cocoa Futures

Ldn Cocoa 05102022

Ldn cocoa futures opened lower yesterday but consolidated during the day, testing support at 1865. The market closed at 1876. The RSI is falling, and %K/%D is negative and diverging. The MACD diff is positive and converging, suggesting growing selling pressure. The indicators point to lower prices in the near term, and to confirm the rejection of the support, prices need to take out 1865. A break below this level towards 1850 would confirm the strong bearish momentum. Conversely, appetite for prices above the 1884 level could trigger a test of resistance at 1900. A doji candle signals uncertainty about the outlook for lower prices, and if the futures continue to struggle above 1900, we could see prices edge lower in the near term.

Tables 6 (218)



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