NY 2nd Month Sugar Futures
NY sugar futures edged lower yesterday as moderate selling pressure triggered a close at 18.92. The stochastics are falling, with the %K/%D exiting the overbought territory; the MACD diff just converged on the downside, a strong selling pressure. A break of the 18.80 level could trigger losses through 19.00, with the tertiary level at 40 DMA at 18.59. On the upside, a break above previous sessions’ highs at 10 DMA at 19.08 could set the scene for a test of 19.50, pointing to a change of trend for more bullish momentum. Yesterday’s bearish spinning top formation points to market indecisiveness about the outlook for higher prices, and we need the futures to break support at 18.80 to confirm the outlook.
Ldn 2nd Month Sugar Futures
Ldn sugar futures held their nerve yesterday after retesting the trend support level. The market closed lower at 538.10. The stochastics are falling, with %K/%D just diverging on the downside, and the MACD diff is positive and converging. On the downside, futures need to break below the trend support of 530 in order to confirm the continuation of the bearish trend. Indeed, the trend support level has been robust in the last couple of months, supporting the ascending triangle formation, a break below this level would suggest strong conviction on the downside. Alternatively, the reaffirmation of support at current levels could set the scene for higher prices back to test the 540 level once again, confirming an inverse hammer formation in the near term.
NY 2nd Month Coffee Futures
Prices weakened yesterday as moderate selling pressure triggered a close at 169.75. The MACD diff is positive and converging. The stochastics are rising but about to converge on the downside near the overbought territory, suggesting a strong selling pressure soon. The RSI is also falling, but the inside day yesterday suggests a continuation of the recent trend of moderate upside. Dips in the market have not been well bid, but to suggest further downside, futures need to break the 10 DMA level at 168.71 and the robust support at 40 DMA at 165.45. If prices at current levels hold, the futures could break above 174.35 and then 180. The indicators point to growing downside momentum, but candles need to break below the near-term support to confirm that.
Ldn 2nd Month Coffee Futures
Lnd coffee futures sold off yesterday as protracted selling pressure prompted a break of support at the moving average to close on the back foot at 1824. The stochastics are falling, crossing, and the MACD diff is positive and converging, suggesting lower prices in the near term. The break of the key support levels 10 and 40 DMA at 1867 and 1847, respectively, suggests an appetite for lower prices. After that, the primary support level stands at 1800 respectively. If prices find support at this level, this could prompt a recovery back above the moving averages. In the medium term, we could see futures break above 1900. This level has provided strong resistance in recent weeks, and a close above this level would prompt prices to regain upside conviction. We anticipate prices to retreat further in the near term.
NY 2nd Month Cocoa Futures
NY cocoa futures softened yesterday as moderate selling pressure saw futures test appetite below 2600 to close below at 2579. The stochastics have converged on the downside, a clear bearish signal. The MACD diff is positive and converging, confirming the outlook for lower prices in the near term. To confirm that trend, futures need to break below the near-term support at 10 DMA at 2561, which could set the scene for prices to take out 40 DMA at 2506. On the upside, a break back above 2600 would strengthen the bullish momentum into 2700. A bearish candle with a longer lower wick points to an appetite for lower prices, but near-term support caps the downside losses. We expect futures to weaken today.
Ldn 2nd Month Cocoa Futures
Ldn cocoa futures weakened yesterday as futures failed into the resistance at 2000 and closed at 1970. The stochastics continue to rise but are showing signs of converging on the downside. The MACD diff is positive and converging, pointing to a waning buying pressure. A break below the trend line would confirm the outlook for lower prices and the continuation of the pennant formation. This may pave the way for lower prices to 50 DMA at 1948. Conversely, the reaffirmation of support above at 1970 would suggest higher prices and a close above 2000, setting the scene for higher prices towards 2050. Yesterday’s candle body being below Monday’s suggests an appetite for lower prices, and the indicators are pointing to a further increase in prices in the near term.