NY 2nd Month Sugar Futures
NY sugar futures softened on Friday as traders rejected prices above the near-term resistance, prompting a close at 24.34. The RSI is falling, with %K/%D diverging out of the overbought territory. The MACD diff is positive and converging. A break of support at the 10 DMA level at 23.76 could trigger losses to the support level of 22.60. If this level holds firm, we could see prices trend higher back towards 4.50 in the near term, the level futures rejected on Friday. This could then prompt a challenge of the 25.80 level in the medium term. The long candle body points to prices rejecting the trend resistance level on Friday but still struggled to gain downside momentum to break the 10 DMA level.
Ldn 2nd Month Sugar Futures
Ldn sugar futures softened on Friday after finding resistance at the previous day’s high. The market closed at 663. The stochastics are softening, with %K/%D leaving the overbought, while the MACD diff is positive and about to converge on the downside, which would signal a strong sell pressure in the near term. On the upside, a break above 670 would bring into play the 690.20 level, the recent high. On the downside, futures need to break below 10 DMA at 666.62 completely in order to confirm downside momentum. The appetite below that level could trigger losses towards 650; this could strengthen the trend in the long run on the downside. A candle with little shadow after a similar bullish candle highlights the uncertainty for futures to move in either direction. We expect futures to soften marginally in the near term.
NY 2nd Month Coffee Futures
NY coffee futures weakened on Friday as they closed below the 10 DMA at 191.45. The stochastics continue to fall as they edge out of the overbought. The MACD diff is positive and converging, pointing to growing selling pressure. A break below the 40 DMA at 181.66 would confirm the outlook for lower prices and the three black crows formation, a bearish signal. This may pave the way for lower prices to 180. Conversely, the reaffirmation of support above these levels could suggest higher prices and a close back above 10 DMA, setting the scene for higher prices towards 200. A break of short-term DMA is a slightly bearish sign, but the size of Friday’s candle suggests a lack of a strong appetite for lower prices in the near term.
Ldn 2nd Month Coffee Futures
Ldn coffee futures held their nerve on Friday as intraday trading saw futures continue to trade sideways in recent days. The resistance at the 2400 level held firm once again, and futures closed at 2382. The stochastics are falling, with %K/%D falling in the overbought, and the MACD diff is positive and converging, signalling growing selling pressures. To confirm the outlook for lower prices, futures need to break below the support at 10 DMA at 2352, which could set the scene for futures to take out the support at 2300. On the upside, the market needs to take out resistance of 2400 to suggest a strong conviction on the upside. The indicators suggest a growing appetite on the downside, but futures must first break below the 10 DMA level to confirm this.
NY 2nd Month Cocoa Futures
NY cocoa futures held their nerve on Friday as they tested 2995 once again, causing the market to close at 2983. The stochastics are rising after nearly converging on the upside, and the MACD diff is positive and diverging once again, suggesting higher prices in the near term. To confirm the outlook of higher prices, futures need to close back above 3000 and then target 3050. The 10 DMA is closing in and supporting prices on the downside. However, a break below that level at 2924 could set the scene for 2900 and then 2856. The narrow candle body with a longer lower wick points to a lack of appetite on the downside, but the futures need to break above current resistance to confirm the near-term outlook.
Ldn 2nd Month Cocoa Futures
Ldn cocoa gained ground on Friday as buying pressure triggered a close on the front foot at 2285. Futures still struggled to break recent highs of 2286. The stochastics are rising further into the overbought, whereas the MACD diff is positive and continues to weaken slightly, suggesting that futures are overbought and there is a lack of robust appetite on the upside. To confirm further upside pressures, the market needs to take out immediate resistance at 2286 before 2300. On the downside, if the support around the trend level is taken out, we could see prices retreat back through to 2200 and 50 DMA at 2132. A longer upper wick on Friday points to the appetite for higher prices; however, futures need to take out 2286 in order to confirm this outlook.