NY 2nd Month Sugar Futures
NY sugar futures held their nerve yesterday as intraday trading saw prices close at 20.64. The %K/%D is falling further into the oversold. The MACD diff is negative and diverging, but the momentum is slowing, suggesting a waning appetite for lower prices. Futures need to break above the 21.00 level to trigger the momentum on the upside. A break above this level towards 10 and 40 DMA levels, at 21.58 and 22.31, respectively, would confirm the strong bullish momentum. Conversely, appetite for prices below the 20.50 level could trigger a test of support of 20.00. A long-legged doji candle shows indecision about either direction as it traded and struggled below 20.50. The indicators point to waning selling momentum, but futures need to close above the 21.50 resistance to confirm this.
Ldn 2nd Month Sugar Futures
Ldn sugar futures edged lower yesterday as prices tested the 574 level before closing at 577.30. The indicators continue to favour the downside, with %K/%D diverging on the downside in the oversold area. The MACD diff, however, is pointing to softer selling pressures. A break below 574 would bring into play the support level at 550; this would help confirm the stronger downside momentum. Prices have been relatively well supported above current levels, and in order to indicate a double bottom and an improvement of market sentiment on the upside, futures need to gain a footing above the previous day’s highs at 590 and then target the 10 DMA in the near term, a firm resistance level. The break above that resistance level would confirm the outlook for higher prices.
NY 2nd Month Coffee Futures
NY coffee futures held their nerve yesterday as intraday trading caused the market to close at 183.35. The stochastics are rising, and the MACD diff is negative and converging, suggesting higher prices in the near term. To confirm the outlook for higher prices, futures need to close back above 188.50 and then target 190. The 100 DMA is starting to close in and support prices from the downside. However, a break below that level could set the scene for 170. Continued rangebound moves point to market uncertainty, and the futures need to break out of current resistance/support to confirm the longer-term outlook.
Ldn 2nd Month Coffee Futures
Ldn coffee opened higher yesterday; however, it struggled above 3200, prompting futures to close at 3180. The stochastics are rising, with %K/%D about to enter the overbought territory. The MACD just converged on the upside, pointing to a strong buy signal. The confirmation of support above the shorter-term moving averages may prompt a break back towards resistance at 3230; a subsequent breach of this level could trigger gains towards 3300. On the downside, a break of 10/40 DMA at 3110 may prompt futures to retest the last session’s support at 3050. A short lower wick points to a lack of appetite for higher prices; however, the future needs to break above the current resistance to confirm the indicators’ outlook for higher prices.
NY 2nd Month Cocoa Futures
NY cocoa futures opened above the previous day’s close; however, prices struggled above the recent high of 6677 and closed on the back foot below 6500 at 6450. The stochastics remain overbought, and the MACD is positive and converging, suggesting waning buying pressure. The rejection of higher prices may prompt a break back towards support at 10 DMA at 6240. A subsequent breach of this level could trigger losses towards 6000. On the upside, a break of resistance at 6677 may prompt futures to test the new high of 6700. A subsequent breach of this level would prompt prices to regain upside momentum in the near term. Longer lower wicks point to a lack of appetite out of the current trading range; however, the future needs to break below 10 DMA support to confirm the outlook on the downside.
Ldn 2nd Month Cocoa Futures
Ldn cocoa futures opened higher yesterday, but resistance of 5620 caused futures to close lower on the day at 5482. The stochastics remain elevated; the %K/%D is now diverging on the upside in the overbought. The MACD diff is positive and converging marginally. A break of the 5500 level completely could trigger losses through 10 DMA, with the tertiary level at 5000. On the upside, a break above 5620 could set the scene for bullish momentum towards new highs. The indicators point to a stall in upside momentum; however, we expect futures to remain elevated in the near term.
