NY 2nd Month Sugar Futures
NY sugar futures edged higher once again on Friday, breaking above the 18.50 level to close at 18.60. The stochastics suggest that the futures are overbought, and we could see a change of trend in the near term; %K is now seen falling, converging close to %D. Likewise, the MACD diff is positive and is beginning to converge, suggesting we would see prices lower in the near term. To confirm this, the futures would need to break back below the 18.50 level to 18.17 before targeting the 10- and 100-day Mas at 17.98. Alternatively, the futures tested the resistance of 18.73 on Friday, and if this level is broken above, we could see prices edge higher to 19.00. The shooting star formation confirms the rejection of higher prices, and we expect the futures’ upside momentum to soften before the change of momentum.
Ldn 2nd Month Sugar Futures
Ldn sugar strengthened on Friday, but prices struggled above 540, closing at 538.70. The stochastics have converged on the downside, and the MACD diff is positive and converging, suggesting a sell signal. This was highlighted by today’s candle that has already offset the Friday gains. If the downside momentum prevails, we could see futures fall to 520 before the 10 DMA at 518.21 and 100 DMA at 515.81. Alternatively, if the 540 level is broken above, this could suggest further upside appetite to 550 and 560, respectively. A bearish candle today following a similar bullish candle on Friday suggests that resistance at 540 has been formed and could trigger losses below this level in the near term.
NY 2nd Month Coffee Futures
NY coffee edged higher as moderate buying pressure caused the futures to close at 168.10. The stochastics continue to edge out of the oversold, and the MACD diff is gaining ground in the positive territory. Friday’s candle tested the 10 DMA level at 168.96; the level capped upside momentum in recent weeks. If this level is broken above, it could trigger gains to 180 and then 182.50. If the resistance holds, we could see the futures set the scene back to 165.95 and 160, the recent lows. The longer upper wick on Friday suggests that the level above 170 was rejected, and today’s softness confirms that. We expect the futures to be capped by 10 DMA in the near term.
Ldn 2nd Month Coffee Futures
London coffee futures edged higher on Friday as intraday trading saw prices close at 1836. The stochastics are seen converging back into the oversold territory once again, and the MACD diff is positive and diverging slightly. A break of 1827 could trigger losses through 1800, with the tertiary level at 1790. On the upside, a break above last session’s highs at 1852 could set the scene for bullish momentum to 1872 and 1900. After the last session’s spinning top formation, the market is uncertain above the direction of the move, as prices struggle above 10 DMA, and we could see marginal downside in the near term.
NY 2nd Month Cocoa Futures
NY cocoa futures sold off on Friday as prices formed resistance at 2577, the May high. The level held on, and the futures closed at 2518. The stochastics suggest that the recent bull run is nearly over, as %K/%D is about to converge on the downside in the overbought, and the MACD diff is positive and converging. We could see the futures soften further today into 2500 before 40 DMA at 2470 and 10 DMA at 2450. On the upside, a break above the 2577 level could trigger gains through 2600. Friday’s long candle body suggests a strong trend reversal, which we expect to continue in the near term.
Ldn 2nd Month Cocoa Futures
Ldn cocoa sold off on Friday as prices continued to decline after the peak of 2050 to close at 1971. The stochastics have converged on the downside in the overbought and is now seen falling, and the MACD diff is positive and converging. This could set the scene for lower prices to 1970 and 1950. The next robust support level is at 50 DMA at 1899. Alternatively, a break back above 2000 to 2030 could suggest further upside. We expect the downside momentum to continue in the near term.
