NY 2nd Month Sugar Futures
Prices weakened yesterday as moderate selling pressure triggered a close below 100 DMA level of 25.73; the market closed at 24.58. The stochastics are falling moderately, and %K/%D is diverging on the downside further into the oversold territory, signalling a continuation of the trend. The MACD is negative and diverging, and a long candle body supports market decisiveness for lower prices. Futures have continued to weaken after the recent sell-off on the downside, and in order to confirm the change of momentum, prices need to break above the current resistance at 100 DMA and then 40 DMA at 25.73. Conversely, a break below the trend support level could set the scene for a test of 24.00. We expect prices to remain on the back foot.
Ldn 2nd Month Sugar Futures
Ldn sugar weakened yesterday as protracted selling pressure triggered a close on the back foot below the robust support level of 700 at 685.50. The stochastics are falling, and the %K/%D continues to weaken further into oversold. The MACD diff is negative and diverging. A full bearish candle suggests growing selling pressures; this could set the scene for lower prices to break below the 100 DMA support level at 686.47. This would confirm the trend for falling prices, down to 664. On the upside, resistance at 40 DMA at 703.50 is now standing firm, and appetite above that level would strengthen the bullish momentum. This could also trigger gains towards the 10 DMA level at 710.42. The protracted bearish candle suggests a strong momentum on the downside, but with the indicators being oversold, we expect the weakness to slow down in the near term.
NY 2nd Month Coffee Futures
NY coffee futures held their nerve yesterday as intraday trading saw futures test appetite at 150. This level held firm, and the future closed at 149.70. The stochastics are converging on the upside, and the MACD diff is negative and converging, signalling waning selling pressures. To confirm the outlook for higher prices, the market needs to take out the resistance at 150 and then the shorter-term moving averages at 152. On the downside, a break below the support at 147.20 could set the scene for futures to take out the 143. A doji candle after a bullish candle signals uncertainty about the outlook for higher prices, and the futures need to take out the 150 level.
Ldn 2nd Month Coffee Futures
Ldn coffee futures softened yesterday after breaching the support at 2342. The market closed at 2332. The stochastics are falling further into the oversold territory, and the MACD diff is negative and diverging, suggesting we could see lower prices through the near-term support of 2340. On the upside, futures need to gain back above 2400 in order to confirm upside momentum. The reaffirmation of support here could trigger gains towards the level at 10 DMA at 2402; this could strengthen the trend in the long run on the upside. The appetite on the downside is growing, and we could see the price edge lower in the near term.
NY 2nd Month Cocoa Futures
NY cocoa futures held their nerve yesterday as moderate selling pressure prompted a close above the previous day’s low at 3444. The stochastics are flat and oversold, and the %K/%D is converging on the upside, highlighting waning selling pressures. The MACD diff is negative and converging. To confirm a bullish candle, futures need to close above yesterday’s highs of 3530 and then target 3600. On the downside, the break below the current trend support level of 3410 could set the scene towards 3400. However, the market struggled below the level in recent sessions, and a break below is needed to confirm the bearish outlook in the near term.
Ldn 2nd Month Cocoa Futures
Ldn cocoa futures held their nerve yesterday after finding support above the 10 DMA once again. The market closed at 2947. The stochastics continue to rise, now out of the oversold, and the MACD diff is negative and converging. On the upside, futures need to gain back above 3000, a robust resistance level, in order to confirm upside momentum. The reaffirmation of support here could trigger gains towards the level at 3050; this could strengthen the trend in the long run on the upside. Alternatively, a break below the 2900 level before the 40-day moving average at 2876 would confirm growing downside impetus. The inside candle, however, points to a continued momentum sideways in the near term, as futures remain supported by the trendline.