NY 2nd Month Sugar Futures
NY sugar futures sold off yesterday after investors rejected prices above support at 24.00, prompting a close just above 100 DMA at 22.92. The stochastics are falling, with RSIs entering the oversold territory. Likewise, the %K/%D is diverging into the oversold, suggesting a negative trend. The MACD diff is negative and diverging, indicating improving sentiment on the downside. To confirm another bearish candle and the three black crows’ formation, prices need to break below the support level at 100 DMA before 22.60. Conversely, to regain upside conviction, futures need to close back above 24.00 and then shorter-term moving averages at 24.96. Near-term momentum is on the downside, and the close below the shorter-term DMA confirms this trend.
Ldn 2nd Month Sugar Futures
Ldn sugar futures weakened yesterday, breaking below 650, but struggling to breach the 100 DMA level to close at 630.10. Indeed, the indicators continue to weaken, with the %K/%D falling further in the oversold, and the MACD diff is negative and diverging on the downside, highlighting the strength of the recent selling pressure. If futures completely break below the 100 DMA level at 632.78 completely, the next level of support stands at 619 and then 600, the lows now seen since March. Alternatively, if the futures break back above 650 and 661.10, this could set the scene for prices back above the moving averages at 680. Friday’s long candle body with a long downside shadow points out protracted selling pressure on the day, and we expect the futures to test the 100 DMA level once again today.
NY 2nd Month Coffee Futures
NY coffee edged higher yesterday as intraday trading caused futures to test appetite at 164.05 once again; the market closed above at 166.95. Stochastics are beginning to rise, and %K/%D are about to converge on the upside on the upside out of the oversold, suggesting a change of momentum in the near term. The MACD diff is negative, and recent downside pressures are seen stalling. To maintain positive momentum, prices need to close above 170 and then target a 10 DMA at 173.81. On the downside, the rejection of prices above this level could trigger losses back to the 164.05 level. Buying pressure remains weak, but the indicators point to growing buying pressure, and the narrow candle body confirms market uncertainty. Futures need to gain back above 170 to suggest a change of momentum in the near term.
Ldn 2nd Month Coffee Futures
Ldn coffee futures struggled to break above 10 DMA resistance once again yesterday as intraday trading saw prices close below at 2715. The RSI is falling, and %K and %D are beginning to show signs of convergence, as %K is tailing off, which could signal a change of momentum to more bullish in the near term. The MACD diff is negative and diverging, suggesting some appetite for lower prices before a trend change. To confirm this, futures need to break the resistance of 10 DMA at 2732 to trigger the momentum. A break above this level towards 2790 would confirm the stronger positive momentum. Conversely, appetite for prices below 2675 would trigger a test of trend support of 2610. A gravestone doji candle shows rejection of lower prices but lacks the conviction to break above the near-term resistance levels in the form of moving averages. This suggests we could continue to see rangebound activity in the near term.
NY 2nd Month Cocoa Futures
NY cocoa futures held their nerve yesterday as intraday trading saw futures test appetite at the trend resistance at 3275. This level held firm, and the future closed at 3258. The stochastics are rising once again into the overbought territory, but the MACD diff is positive and flat, struggling to highlight the outlook in either direction. To suggest the outlook for lower prices, the market needs to take out support 10 DMA at 3226 and then support at 3200. On the upside, a break above the trend resistance at 3275 could set the scene for futures to take out the 3281 level before targeting 3300. A doji candle after solid upside gains signals uncertainty about the outlook for higher prices, and futures would need to take out the trend resistance to confirm the appetite for higher levels.
Ldn 2nd Month Cocoa Futures
Ldn cocoa edged higher yesterday after a strong upside candle the day before, causing futures to settle at 2537, marking new highs. Stochastics are rising after %K/%D converged on the upside in the overbought territory, suggesting a continuation of the upside trend in the near term. The MACD diff is positive and flat. To maintain positive momentum, prices need to close above 2540 – the recent highs - and then target 2555. On the downside, the rejection of prices above these levels could trigger losses back to 2500 and 2473, respectively. Buying pressure was weak yesterday, but the indicators point to a continuation of the bullish momentum.