NY 2nd Month Sugar Futures
Prices opened higher day-on-day on Friday but closed lower as moderate selling pressure triggered a close at 17.87. The stochastics are rising, and %K/%D is seen converged on the downside in the overbought, signalling a potential change in trend. The MACD is positive and diverging, but the momentum is seen slowing, and the doji candle formation supports market indecisiveness. Prices have been trading in a narrow range, and in order to confirm the change of momentum, prices need to break above the current resistance at 18.00 and then 18.17. Conversely, a break below 40 DMA at the 17.77 support level could set the scene for a test of 10 DMA at 17.55. We expect prices to struggle above current levels at 18.00 and indicate a change of trend on the downside in the near term.
Ldn 2nd Month Sugar Futures
Ldn sugar futures edged higher on Friday but struggled at higher levels, closing at 513.90. The RSI is rising, and %K/%D is diverging on the upside in the overbought territory. The MACD diff is positive and diverging, suggesting further buying pressures. The indicators point to higher prices in the near term, and to confirm this, futures need to take out 40 DMA at 514.94. A break above this level towards 520 would confirm the strong bullish momentum to 535. Conversely, appetite for prices below the 512.90 level could trigger a test of 10 DMA at 505.16; tertiary support stands at 500. A doji candle signals uncertainty about the outlook for higher prices, and the futures need to take out the 40 DMA to confirm the outlook for a positive trend.
NY 2nd Month Coffee Futures
NY coffee futures buckled on Friday as protracted selling pressure triggered a close on the back foot once again at 193.00. The stochastics are falling in the oversold, and RSI is also falling. The MACD diff is negative and diverging, confirming growing selling pressure; this could set the scene for lower prices towards the 190.50 level. A break below this level would confirm three black crows pattern formation. On the upside, a break above the 10 DMA at 205.46 resistance level and reaffirmation of support above 210 could strengthen the trend on the upside in the long run. Futures need to take out the DMAs in order to confirm the outlook of higher prices. The long body and a long downside wick point to an increased appetite for lower prices, and indicators confirm the outlook for more downside momentum in the near term.
Ldn 2nd Month Coffee Futures
Ldn coffee futures edged lower on Friday as prices closed below 2100 at 2051. The indicators continue to favour the downside, with %K/%D still in the oversold area. MACD is negative and diverging. A break below 2033 would bring into play the support level at 2010. Prices have been relatively well supported below the trendline, and in order to indicate an improvement of market sentiment on the upside, futures need to gain a footing above 2100 and then target the 10 DMA at 2138 in the near term. The long candle body with small wicks suggests that there was a sell-off during the day, the buyers had little appetite for higher prices as the futures closed at July lows of 2050. The break below the current support level would confirm the continuation of downside momentum.
NY 2nd Month Cocoa Futures
NY cocoa futures edged above the previous day's closing price on Friday, but the bullish momentum was not strong enough, and futures closed lower on the day at 2353. The stochastics continue to fall yet seen converging, and the MACD diff is positive and diverging. The rejection of prices at 2400 has formed a candle with a narrow body but a long wick on the upside, suggesting a lack of appetite for higher prices. If prices were to break above this level, this could trigger a test of 2420. To confirm the shooting start formation, futures need to take out the 10 and 40 DMAs at 2352 and then robust support at 2314. A break below this level would confirm the outlook for lower prices.
Ldn 2nd Month Cocoa Futures
Ldn cocoa edged higher on Friday as intraday trading caused futures to test appetite at 1930, and the market closed below at 1929. Stochastics are rising, and %K/%D is about to converge on the upside towards the overbought, confirming negative momentum. The MACD diff lacks conviction to point out an outlook. To maintain positive momentum, prices need to close above 1930 and then target 1950. On the downside, the rejection of prices above 1950 could trigger losses back to the 1900 level. Buying pressure remains weak, but the indicators suggest it might be accelerating in the near term. We expect prices to remain elevated in the near term.