NY 2nd Month Sugar Futures
NY sugar prices declined yesterday after prices rejected resistance at 18.50. The market closed at 18.21. The stochastics continue to weaken, with %K crossing into the oversold, and MACD diff is negative and diverging, suggesting we could see lower prices in the near term. A break below 18.17 could set the scene for a test of support at 100 DMA at 18.08. On the upside, a break back above the 40 DMA level at 18.67 could set the scene for higher prices through 10 DMA at 18.87, confirming the double bottom formation. Three black crows pattern formation, however, confirms indicators' outlook for lower prices in the near term.
Ldn 2nd Month Sugar Futures
Ldn sugar futures edged lower yesterday as prices closed at 520.60. The indicators favour the downside, with %K/%D diverging on the downside into the oversold area, suggesting further selling pressures. A break below the 100 DMA at 519.32 would bring into play the recent sessions' support level at 512.90. In order to indicate an improvement of market sentiment on the upside, futures need to gain a footing above 40 DMA at 530.47 and then target the 10 DMA level at 536.30 in the near term. The three black soldiers' formation in line with NY sugar suggests strong selling pressures. The break below the support level of 100 DMA would confirm this formation.
NY 2nd Month Coffee Futures
NY coffee futures held their nerve yesterday as intraday trading caused the market to close at 160.60. The stochastics are falling, and the MACD diff is just converged on the downside, suggesting lower prices in the near term. The RSI is also falling; to confirm the outlook of lower prices, futures need to close back below the robust support level at 160, the level it struggled to break for the last couple of months. The 10 DMA is starting to close in and resisting prices on the upside. However, a break above that level at 167.43 could set the scene for 174.35. A narrow-bodied candle after a robust bearish candle in the last couple of sessions points to market uncertainty, and the futures should struggle to break the near-term support in the meantime.
Ldn 2nd Month Coffee Futures
Ldn coffee futures weakened yesterday after investors rejected prices above 1882 once again, prompting a close below at 1832. The stochastics are falling, with RSIs in neutral territory; the %K/%D is also seen converging on the downside, which could create a strong sell signal, suggesting a short-term negative trend. The MACD diff is negative and diverging once again, indicating improving sentiment on the downside. To confirm another strong candle on the downside, prices need to break below the support level at 40 DMA at 1845 completely before 1800, a robust support level and a below would confirm the outlook on the downside. On the upside, to regain upside conviction, futures need to close back above 1882 and then 1900 in the near term. Near-term momentum is on the downside, the indicators confirm this trend, but to break out of the tight range, the volumes need to increase further to drive the momentum.
NY 2nd Month Cocoa Futures
NY cocoa futures edged marginally higher, but the bullish momentum was not strong enough to break above the recent highs, and futures closed at 2624. Still, the stochastics converged on the upside and now gaining ground back into the overbought, and the MACD diff is positive and diverging. The rejection of prices at 2640 has formed a candle with a narrow body but a longer wick on the upside, suggesting markets testing and rejecting prices above near-term resistance. If prices were to break above this level, this could trigger a test of 2670, the recent high. To confirm the shooting star formation, futures need to take out 10 DMA at 2601 and then robust support at 40 DMA at 2524. A break below this level would confirm the outlook for lower prices.
Ldn 2nd Month Cocoa Futures
Ldn cocoa futures jumped higher yesterday, breaking above resistance at 2000 and closing at 2011. The stochastics are rising, with %K/%D just diverging on the upside further into the overbought, and the MACD diff is positive and diverging. The reaffirmation of support at 2000 could set the scene for higher prices back to test the 2050 level. On the downside, futures need to break below the support of 50 DMA at 1954 in order to end the recent sessions' bull trend. Indeed, the moving averages provide robust support levels. A strong candle on the upside confirms the outlook of higher prices, and a complete break above 2000 would highlight the appetite for higher prices. The market needs to gain a footing above the 2050 level in the immediate term to improve the outlook.
