NY 2nd Month Sugar Futures
NY sugar futures gained ground on Friday after the 19.64 support held firm once again; the prices closed at 20.25. Futures momentum has been range-bound in recent weeks, fluctuating between 19.64 and 20.48, respectively. The stochastics are confirming the uncertainty for prices out of the levels, with %K/%D wavering between gains and losses, and the MACD diff is negative and flat. Volumes remain robust but are diminishing slightly day-on-day. To confirm the outlook for lower prices, futures need to break below 19.64 before targeting 40 DMA at 19.44. Alternatively, if prices were to break above 20.48, this could trigger gains to 20.50 and 20.91, respectively.
Ldn 2nd Month Sugar Futures
Ldn sugar futures jumped higher on Friday above 560, however, struggled to break above the trend resistance at settled at 572.70. The stochastics are continuing to rise but are now overbought, and the upside momentum is slowing. Likewise, the MACD diff is positive and diverging. The most recent gains have found resistance at 575.40. A break above this level could set the scene for bullish momentum towards the high of 580. On the downside, a break of the 560 level could trigger losses through 10 DMA at 557.86, with the tertiary level at 553.20. A protracted bullish candle on Friday confirms the appetite for higher prices, but trend resistance is firm and will cap upside momentum in the near term.
NY 2nd Month Coffee Futures
NY coffee futures continued to weaken slightly, breaking below the 180 support level to settle at 177.85. The stochastics confirm the building downside trend, with %K/%D diverging on the downside, while the MACD diff converged on the downside. This could indicate weaker prices in the near term, falling to test 174.35 before 40 DMA at 171.29. On the upside, futures would have to retest the 10 DMA level at 186.27 and then target 194.15. We expect futures to soften further in the near term but to struggle below the longer-term moving averages. With 40 DMA now also crossing above 100 DMA, a golden cross formation, we expect this to provide robust support for prices.
Ldn 2nd Month Coffee Futures
Ldn coffee weakened marginally on Friday, but 10 DMA support held firm, and futures closed at 2162. The indicators are pointing to accelerating downside momentum, with %K/%D converging on the downside and now falling out of the overbought, and the MACD diff is positive and converging, suggesting softening momentum on the upside. For this to materialise, futures would need to break the 10 DMA support level first at 2155 before testing the 2131 and 2100, respectively. A strong upside trend in recent weeks brought futures to test the resistance of 2200; we expect this level to be retested again in the near term before a change of momentum on the downside.
NY 2nd Month Cocoa Futures
Prices weakened on Friday as moderate selling pressure triggered a close at 2760. The stochastics are falling; the %K/%D have exited the overbought territory, signalling a potential change in trend. The MACD is positive and converging, suggesting we could see lower prices in the near term. Prices broke below the 10 DMA at 2779, and a candle with a long candle body and little shadow suggests further downside down to 2750 and 2700. On the upside, a break back above 2800 could see the test of the 2856 level. We expect prices to weaken today and remain on the back foot in the near term.
Ldn 2nd Month Cocoa Futures
Ldn cocoa futures weakened on Friday, closing below the 2150 level at 2112. The stochastics are falling, and the MACD diff is also positive and converging, pointing to a near-term decline in prices. Prices need to break below the support of 2100 completely before targeting 50 DMA at 2030. This would break the recent narrow trading range. Conversely, if support at 2100 can hold firm, this could trigger gains towards the resistance at 2155. A breach of this level would confirm the outlook for higher prices, with gains seen towards 2200. We expect the momentum to remain on the back foot, but the futures need to break below the current support level to confirm the momentum.