NY 2nd Month Sugar Futures
NY sugar edged higher yesterday as intraday trading caused futures to test appetite at 23.00 once again, prompting a close at 22.99. Stochastics are rising, and %K/%D continues to diverge on the upside in the overbought territory, suggesting a continuation of the recent trend in the near term. The MACD diff is positive and converging, suggesting waning buying pressure. The indicators suggest that we might see further upside in the near term, but the momentum is stalling. The next robust resistance now stands at 23.00, and a break above this level might trigger further gains to 23.42. On the downside, the rejection of prices above this level could trigger losses back to the shorter-term moving averages before targeting 21.50. Buying pressure is weakening; however, the support at the MAs is firming up. With the 10 DMA crossing above the 40 DMA level, we expect to see futures strengthen over the longer term, although a near-term pause is likely in the meantime.
Ldn 2nd Month Sugar Futures
Ldn sugar futures edged higher yesterday, breaking above resistance at 650 and closing at 655.50. The stochastics are edging higher in the overbought territory, and the MACD diff is positive and converging, outlining waning bullish momentum. On the upside, futures need to break completely above the 660 level in order to confirm upside momentum. The reaffirmation of support here could trigger gains towards the 100 level at 686.30; this could strengthen the trend on the upside in the long run. A break down below the current support would bring into play the 40 DMA level at 629.64, which could set the scene for support at 615. We see prices edge higher in the near term; however, the upside might weaken slightly in the near term.
NY 2nd Month Coffee Futures
NY coffee futures opened slightly higher but managed to close lower day-on-day at 187. The stochastics are rising, which could suggest further upside in the near term. The MACD diff is negative and about to converge on the upside, which would send a strong buy signal. On the upside, futures need to break above the robust resistance levels of 188.50 and 190 to trigger the momentum. Prices would then need to take out the 200 level to confirm the longer-term outlook. Conversely, appetite for prices below the 40 DMA at 183.48 could trigger a test of support of 10 DMA at 181.08 before 180. A dragonfly doji candle shows rejection of higher prices and could point to an end of the bullish sentiment we have seen in the last couple of days. However, the indicators point to further gains in the near term. We expect prices to pause today before continuing to strengthen in the near term.
Ldn 2nd Month Coffee Futures
Ldn coffee futures lost marginal ground yesterday after prices struggled above the 3200 level, prompting a close at 3182. The stochastics are seen converging on the downside in the overbought, and the MACD diff is now positive and converging as futures failed to confirm the outlook for higher prices. On the downside, the short-bodied candle suggests a low appetite for softer prices in the near term. Prices need to close below the trend support at 3100 before targeting 10 DMA at 3073. A bearish inside candle suggests uncertainty surrounding the outlook for lower prices, and until the futures break out of the current range, we are likely to see lacklustre momentum.
NY 2nd Month Cocoa Futures
NY cocoa futures strengthened yesterday, testing prices above the 4600 level. However, the bullish momentum was not strong enough, and futures closed at 4557. The stochastics are now converging on the downside, about to send a sell signal, but the MACD diff is positive and diverging. The rejection of prices above 4600 has formed a candle with a narrow body but a long wick on the upside, suggesting an appetite for higher prices; however, lacking the conviction to break above the near-term resistance. If prices were to break above this level, this could trigger a test of yesterday’s high of 4669. To confirm the shooting start formation, futures need to take out 4400 and then robust support at 10 DMA at 4354. A break below this level would confirm the outlook for lower prices.
Ldn 2nd Month Cocoa Futures
Ldn cocoa futures failed above 3675 once again yesterday as intraday trading caused futures to close at 3675. The stochastics are falling in the overbought, converging on the downside, and the MACD diff is now positive and converging, suggesting a change of trend in the near term. The rejection of prices above 3675 has formed a candle with a narrow body but a long wick on the upside, suggesting an appetite for higher prices; however, lacking the conviction to break above the near-term resistance. If prices were to break above this level, this could trigger a test of 3700 and 3721, respectively. To confirm the shooting start formation, futures need to take out 3600 and then robust support at 10 DMA at 3549. A break below this level would confirm the outlook for lower prices.