NY 2nd Month Sugar Futures
NY sugar futures edged lower on Friday after prices held above the shorter-term moving averages once again, prompting a close at 25.93. The stochastics are falling, with %K/%D diverging on the downside, and the MACD diff crossed into a negative, sending a sell signal. To confirm the bearish indicators and rejection of prices above 26.50, futures need to take out support at moving averages at 26.10 and then target the 100 DMA at 25.21. On the upside, futures need to close above 26.50 and then test 27.00 in order to confirm the outlook of higher prices towards 28.00. We expect futures to weaken in the near term.
Ldn 2nd Month Sugar Futures
Ldn sugar futures edged marginally lower on Friday as intraday trading saw prices close at 737 as it struggled above 750 once again. The %K/%D is edging lower, which could suggest marginal downside pressure. The MACD diff is negative and now diverging. On the upside, futures need to break above 750, a firm resistance, to trigger the momentum. A break above this level towards 762.61 would confirm the growing bullish momentum. Conversely, appetite for prices below the 730 level could trigger a test of support at 40 DMA at 723.60. Friday’s candle shows rejection of higher prices, as futures struggled above that level in recent sessions. We expect futures to weaken marginally in the near term.
NY 2nd Month Coffee Futures
NY coffee futures weakened on Friday but struggled to break completely below the 10 DMA level, causing the futures to close slightly lower 170.55. The stochastics have converged on the downside and are now falling, and the MACD diff is now positive and converging. In order to confirm the change in trend, prices need to break below the support of 10 DMA at 168.35 completely and then support at 160. Conversely, a break above the 175 resistance could set the scene for a test of 180. We expect prices to weaken in the near term.
Ldn 2nd Month Coffee Futures
Ldn coffee futures softened on Friday after finding support above 2400. The market closed at 2421. The stochastics are gaining ground towards the overbought territory, however, the momentum is slowing, and the MACD diff is positive and converging, suggesting we could see lower prices in the near term through the shorter-term moving averages at 2380. A break below these levels would bring into play the 2342 level, which could set the scene for 2300. On the upside, futures need to gain back above the 100 DMA at 2453 in order to confirm upside momentum. The reaffirmation of appetite above this level could trigger gains towards the level at 2500; this could strengthen the trend in the long run on the upside. The hanging man formation, where there was some weakness during the day, points to an end of the uptrend, however, the short candle body points to market uncertainty about the change of trend.
NY 2nd Month Cocoa Futures
NY cocoa strengthened on Friday as protracted buying pressure triggered a close on the front foot at 4014, marking new highs. The stochastics are rising, with %K/%D diverging on the upside in the overbought. The MACD diff is seen diverging on the upside once again. A long bullish candle body with short wicks suggests growing buying pressures; this could set the scene for higher prices to break above the 4040 resistance. This would confirm the trend for rising prices, up to 4050. On the downside, a breach of support at 4000 would strengthen the bearish momentum. This could also trigger losses towards the 10 DMA at 3912. Indicators point to higher prices in the near term.
Ldn 2nd Month Cocoa Futures
Ldn cocoa futures surged on Friday, breaking above the robust resistance at 3400 and closing at 3476. The stochastics are rising, with %K/%D diverging on the upside in the overbought territory, and the MACD diff is positive and diverging. The reaffirmation of support at 3450 could set the scene for higher prices back to test the 3500 – new highs. This would confirm the three white soldiers’ formation and the outlook for higher prices. On the downside, futures need to break below the support of 10 DMA in order to end the recent bull trend. Then, 3300 and 3200 are providing robust support levels. The market needs to gain a footing above the 3500 in the immediate term to confirm a further bullish outlook.