NY 2nd Month Sugar Futures
NY sugar futures weakened marginally yesterday after testing the support level of 10 DMA. The market closed lower at 20.17. The stochastics are falling after %K/%D just converged on the downside, and the MACD diff is negative and diverging. The reaffirmation of support at 10 DMA at 202.26 could set the scene for higher prices back to test 20.48, confirming an inverse hammer formation. On the downside, futures need to break below the support of 20.00 in order to confirm the bearish trend. Indeed, the 10 DMA support level has been robust in the last couple of days; a break below this level would suggest a strong conviction on the downside. The longer upper wick with a narrow body confirms the support is still intact.
Ldn 2nd Month Sugar Futures
Ldn sugar futures weakened marginally yesterday after breaching the support level of 10 DMA. The market closed lower day on day at 568.60. The stochastics are falling, with %K/%D diverging on the downside after flipping on the downside, a strong sell signal. Likewise, the MACD diff is positive and converging and is now falling, pointing to a building bearish trend across the indicators. To confirm this, futures need to break below the support of 10 DMA at 570.55, down to 560. The DMA support levels have been robust in the last couple of sessions, and a break above these levels could suggest growing conviction on the downside. On the upside, reaffirmation of support at these levels could set the scene for higher prices back to breach 575.50 up to 580, confirming an inverse hammer formation. The indicators suggest growing selling pressures in the near term, and if the support at 10 DMA is broken, this could suggest a longer term trend on the downside.
NY 2nd Month Coffee Futures
NY coffee futures held their nerve yesterday as intraday trading caused the market to close at 179.13. The stochastics are falling once again after nearly converging on the downside, suggesting rebuilding downside momentum, and the MACD diff is negative and converging once again, 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 40 DMA at 175.57 and then target 100 DMA at 170.05. The moving averages are closing in and supporting/resisting prices. However, a break above the 10 DMA at 179.13 could set the scene for 180. Two narrow-bodied candles in the last couple of sessions point to market uncertainty out of current ranges, and the futures need to break out of current resistance/support to confirm the longer-term outlook. Still, we expect futures to test the current support levels, edging lower.
Ldn 2nd Month Coffee Futures
Ldn coffee futures weakened yesterday as futures closed lower at 2080. The stochastics continue to fall as they edge closer to oversold. The MACD diff is negative and diverging, pointing to growing selling pressure. A break below 40 DMA at 2072 would confirm the outlook for lower prices and the three black crows formation, a clear bearish sentiment. This may pave the way for lower prices to 2062 with the tertiary level at 2050. Conversely, the reaffirmation of support above 40 DMA would suggest higher prices and a close above 2100, setting the scene for higher prices back towards the 10 DMA at 2148. Yesterday’s candle body suggests an appetite for lower prices, however, we expect futures to struggle below 40 DMA in the near term.
NY 2nd Month Cocoa Futures
NY cocoa futures softened yesterday after testing the support level of 2650. The market closed at 2658. The stochastics are falling in the oversold, but %K/%D is seen converging, which could indicate a buy signal in the near term, and the MACD diff is negative and diverging. The appetite back above 2670 could set the scene for higher prices back to test the 40 DMA at 2688, confirming the hammer formation. On the downside, futures need to break below the support of 2650. The 100 DMA support level has remained robust, but a break below 2600 could set the scene for this level would suggest strong conviction on the downside in the near term.
Ldn 2nd Month Cocoa Futures
Ldn cocoa futures opened lower but managed to close higher day-on-day at 2053. The stochastics are oversold but are flattening, which could suggest a change of momentum in the near term. The MACD diff is negative and diverging. On the upside, futures need to break above the robust resistance levels of 50 DMA at 2048 and 2055 to trigger momentum. Prices would then need to take out the 2100 level to confirm the longer-term outlook on the upside. Conversely, appetite for prices below 2010, to 100 DMA at 1999. Downside momentum is slowing as the 50 DMA is holding firm, and we expect futures to remain supported at current levels in the near term.
