NY 2nd Month Sugar Futures
Prices weakened on Friday as moderate selling pressure triggered a close below the trendline level; the market closed at 25.75. The stochastics are falling, signalling a continuation of a bearish trend. The MACD diff is negative and diverging, but the candle with a longer shadow suggests that futures might struggle to break below the 100 DMA level at 25.46. Dips in the market have been well bid in the last couple of sessions, but in order to confirm the continuation of a strong bearish trend, prices need to break below the current support of 100 DMA and then 25.00. Conversely, a break above the 10 DMA resistance line at 25.97 could set the scene for a test of 26.00. We expect prices to remain supported above the 200 DMA support level in the near term.
Ldn 2nd Month Sugar Futures
Ldn sugar weakened on Friday as protracted selling pressure triggered a close on the back foot near recent lows at 718.30. The stochastics are falling, with %K/%D diverging on the downside in the oversold. The MACD diff is negative and diverging. The long candle body suggests growing selling pressures; this could set the scene for lower prices to break below the 715 support level. This would confirm the trend for falling prices, down to the 200 DMA at 706.64. On the upside, resistance at 10 and 40 DMAs has proven to be strong in recent sessions, and appetite above these levels would strengthen the bullish momentum. This could also trigger gains towards the 740. Narrowing support and resistance levels are creating a narrow trading range, but with the 10 DMA crossing below the 40 DMA – a death cross, we believe that the prices will edge marginally lower in the near term.
NY 2nd Month Coffee Futures
NY coffee futures held their nerve on Friday as intraday trading saw prices close at 168.15. the %K/%D is falling. The MACD diff is negative and diverging, suggesting a further appetite for lower prices, but futures need to break below the 164 support to trigger the momentum. A break below this level towards the 40 DMA at 161.40 would confirm the growing downside momentum. Conversely, appetite for prices above the 10 DMA at 170.51 could trigger a test of resistance at 175. A long-legged doji candle shows indecision about either direction as it traded between 10 DMA and 164; the length of the wicks also points to increased volatility during the day. The indicators point to a further fall in prices, but futures need to close below 164, the level they struggled to break below in the last couple of sessions.
Ldn 2nd Month Coffee Futures
Ldn coffee futures held their nerve on Friday as intraday trading saw futures test appetite at the trendline. This level held firm, and the future closed at 2545. Today’s candle opened lower but struggled to pierce the 100 DMA level. As a result, the stochastics are falling, with %K/%D falling out of 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 100 DMA at 2447, which could set the scene for futures to test 2400. On the upside, the market needs to take out resistance of 2518 and then resistance at 2600. Today’s candle broke out of the band of resistance/support that held prices constrained in the last couple of days. However, to suggest further downside, futures need to close below the 100 DMA to confirm the outlook for lower prices.
NY 2nd Month Cocoa Futures
NY cocoa futures edged lower on Friday but struggled to break below the trendline support level, closing at 4089. The stochastics remain overbought and have just converged but are struggling to suggest a strong outlook on the downside. The MACD diff just converged on the downside. To suggest a change of trend, futures need to break below the support of 10 DMA at 4055 before testing 4000. Alternatively, resistance at 4150 has firmed in recent sessions, and a break back above that level to 4200 would suggest further upside. The indicators point to growing selling pressures in the near term, but the trendline has to be breached first.
Ldn 2nd Month Cocoa Futures
Ldn cocoa futures held their nerve on Friday as intraday trading caused the market to close at 3459. The stochastics are falling, and the MACD diff is negative and diverging, suggesting lower prices in the near term. To confirm the outlook of lower prices, futures need to close back below 3400 and then target 3300. The 10 DMA is starting to close in and resisting prices on the upside. However, a break above that level could set the scene for 3569. Two narrow-bodied candles in the last couple of sessions point to market uncertainty, and the futures need to break out of current resistance/support to confirm the longer-term outlook.