NY 2nd Month Sugar Futures
NY sugar futures held their nerve yesterday, causing the market to close at 25.99. The stochastics are rising, but the momentum is slowing, with %K/%D converging on the downside next to the overbought area, and the MACD diff is positive and flat, suggesting upside appetite in the near term. To confirm the outlook for lower prices, futures need to close below the 10 DMA at 25.74 and then target the 100 DMA at 25.04. On the upside, a break above the 40 DMA level at 26.16 could set the scene for 27.00, the recent high. A bearish candle with a narrow body and longer lower wick after a similar bearish candle points to uncertainty about the outlook, and the futures need to break out of current support to confirm the near-term outlook on the downside.
Ldn 2nd Month Sugar Futures
Ldn sugar futures gained ground yesterday as marginal buying pressure triggered a close on the front foot above the moving averages at 731.30. The stochastics are converging on the downside, with the %K/%D in the overbought area, as the MACD diff is positive and diverging. This suggests we could see higher prices in the near term before a trend reversal. The next robust resistance level stands at 750, but the market needs to take out an immediate resistance of 747.10. On the downside, the candle closed above 10 DMA at 719.89, and if this level does not hold, we could see prices test 40 DMA before 700. Longer lower wick points to a growing appetite on the downside, and futures need to break below the shorter-term moving averages completely in order to confirm the outlook on the downside.
NY 2nd Month Coffee Futures
NY coffee futures rallied yesterday as protracted buying pressure triggered a close on the front foot at 161.80. The %K/%D is diverging in the overbought. The MACD diff is positive and diverging, confirming growing buying pressures. On the upside, breaking above the 100 DMA completely could trigger gains to 164.05 – the September high. On the downside, a break below the support level of 40 and 10 DMAs at 152 could trigger losses back towards the support at 150. The futures are being supported by shorter-term MAs, and with the 10 DMA about to break above the 40 DMA, a golden cross, we could see support at these levels solidify. Strong bullish candles highlight strong appetite on the upside, but prices need to break above the 164.50 level to confirm continued bullish sentiment.
Ldn 2nd Month Coffee Futures
Ldn coffee futures rallied yesterday as buying pressure triggered a close on the front foot at 2402. The stochastics are rising, about to enter the overbought, as the MACD diff is positive and diverging, signalling continued yet softer buying pressures. This suggests we could see higher prices in the near term towards the trend resistance, but the market needs to take out immediate resistance at 40 DMA beforehand. On the downside, the support around 10 DMA at 2289 is robust, and if this level does not hold firm, we could see prices retreat back through 2200. Long candle body points to an appetite for higher prices, and prices need to take out current resistance to confirm the outlook for higher prices.
NY 2nd Month Cocoa Futures
NY cocoa futures edged marginally higher, but the bullish momentum was not strong enough to break above 3678 and futures closed at 3675. The stochastics are beginning to fall, seen converging, as %K is seen tailing in the overbought, and the MACD diff is positive and converging. The rejection of prices at recent highs has formed a candle with a narrow body but a long wick on the upside, suggesting markets testing and rejecting prices above near resistance. If prices were to break above this level, this could trigger a test of 3765, the recent high. To confirm the shooting star formation, futures need to take out 3600 and then robust support at the moving averages. A break below this level would confirm the outlook for lower prices.
Ldn 2nd Month Cocoa Futures
Thursday’s candle continued the upward trajectory from the day before, strengthening once again to close at 3173, beating new highs. A break out of the rangebound environment we have seen in recent months is a strong indicator for further price gains. The indicators are rising, but the momentum is softening, with %K/%D stochastics converging on the downside in the overbought, and the MACD diff is positive and diverging. The same strength could be seen in the volumes, which are also high, suggesting strong market conviction for higher prices. The next resistance level stands at 3200. To confirm the momentum on the upside, the futures need to breach this level in the near term.