NY 2nd Month Sugar Futures
NY sugar futures edged higher yesterday as prices remained above the 40 DMA support to close at 17.85. The indicators continue to favour the upside, with %K/%D diverging in the overbought and MACD diff is positive and diverging. Both indicators, however, see slowing momentum on the upside, and we could see a trend reversal in the near term. To confirm this, a break below the 40 DMA at 17.77 needs to take place; this would bring into play the recent support level at 10 DMA ta 17.55. In order to indicate an improvement of market sentiment on the upside, futures need to gain a footing above 18.00 and then target the recent highs of 18.17 in the near term. The hanging man candle formation suggests waning buying pressure, and we saw futures struggle above 18.00 in the last couple of sessions. We expect the futures to edge marginally higher before the change of trend takes place.
Ldn 2nd Month Sugar Futures
Ldn sugar futures held their nerve yesterday as intraday trading saw futures test appetite at the 512.90 level once again. This level held firm, and the future closed at 511.60. Today, the futures broke above the level, but for now, the 40 DMA is holding firm. The stochastics are overbought, and the MACD diff is positive and diverging, but it seems that the upside has peaked, and we might see a trend reversal in the near term. To confirm the outlook for lower prices, futures need to break below the support at 505.40, which could set the scene for futures to test 500. On the upside, the market needs to take out resistance of 40 DMA at 514.91 and then resistance at 520. If today’s candle struggles above the 40 DMA resistance, we expect this to confirm the lack of prices above current levels and trigger a change of trend on the downside in the near term.
NY 2nd Month Coffee Futures
NY coffee sold off sharply yesterday as protracted selling pressure triggered a breakthrough of the 200 support level and a close on the back foot at 196.05, the lows not seen since July and, before that, October 2021. The stochastics are falling, with the %K/%D diverging further into the oversold, and the RSI has also edged lower. The MACD diff is negative and diverging, suggesting further selling pressures; this could set the scene for lower prices towards the 194.95 level. A break below this would confirm the trend for falling prices, down to the support of 190.50. On the upside, resistance at 10 DMA at 207.41 has proven to be robust in the last couple of sessions, and support above that level would strengthen the bullish momentum. This could also trigger gains towards the trend resistance at 210 and then 212.60. The support at 194.95 is a robust support level, and we expect the futures to struggle below these levels; the indicators suggest the futures are oversold.
Ldn 2nd Month Coffee Futures
Ldn coffee weakened yesterday, as protracted selling pressure triggered a close on the back foot at 2097. The stochastics are falling, and the MACD diff is negative and diverging, suggesting further downside impetus. A full bearish candle suggests growing selling pressures; this could set the scene for lower prices to break below the 2100 support level completely. This would confirm the trend for falling prices down to 2033. On the upside, resistance at 10 DMA at 2144 has proven to be strong, and support above that level would strengthen the bullish momentum. This could also trigger gains towards 2160. A strong bearish candle and a break of the 100 DMA level suggest a strong selling momentum yesterday, and we expect the futures to be capped by the 100 DMA in the near term.
NY 2nd Month Cocoa Futures
NY cocoa futures rallied yesterday as protracted selling pressure triggered a close on the front foot at 2370. The stochastics are showing signs of a trend reversal, and %K/%D is about to give a buy signal as it converges on the upside. The MACD diff is positive and diverging, confirming growing buying pressure; this could set the scene for higher prices to 2400, but futures need to break above the 100 and 10 DMAs at 2352 completely. A break above this level would confirm the outlook of higher prices up to 2420. On the downside, a break below the support level at 2300 level and an appetite for lower prices could set the scene for 2236. Three-line strike formation points that the recent trend on the downside is to prevail in the longer term. To confirm this, futures need to break back below the moving average support levels.
Ldn 2nd Month Cocoa Futures
Ldn cocoa futures edged higher yesterday as intraday trading saw prices close at 1915. The stochastics are rising, with the %K/%D about to converge on the upside near the overbought, and the MACD diff is positive but has remained flat day-on-day. A break of the 1900 level could trigger losses through 50 DMA at 1850, with the tertiary level at 1830. On the upside, a break above resistance at 1930 could set the scene for bullish momentum towards 1950. After the last session’s market indecisiveness – the spinning top formation – as prices struggle below 1900, we could see more upside movement in the near term.