NY 2nd Month Sugar Futures
NY sugar futures softened on Friday after prices failed above the 20.50 level, prompting a close on the back foot at 20.13. The stochastics are falling further into the oversold territory, but the downside momentum is seen stalling, which could suggest a potential trend change in the near term. The MACD diff is diverging on the downside, outlining the weakness in the market. Selling pressure has been growing; Friday’s close below the key support level of 20.50 suggests an increased appetite for lower prices. A break of 20.00 could set the scene for lower prices at 19.80. Alternatively, if prices can gain a footing back above the 20.50 level, the bulls could then retarget the 10 DMA at 21.17 in order to regain upside conviction. We anticipate prices to remain on the back foot in the near term before a potential trend reversal. Support at 19.80 is key.
Ldn 2nd Month Sugar Futures
Ldn sugar softened on Friday as protracted selling pressure prompted a close below the 600 level at 589.20. The stochastics are falling, with the %K/%D edging lower into the oversold. However, the downside momentum is stalling, suggesting we could further softness before a possible trend change. The MACD diff is negative and is diverging, suggesting further softness in the near term. The protracted selling pressure for the last couple of sessions suggests an appetite for lower prices. A complete break below 580.70 would trigger losses down to 575 – a robust support level. In order to confirm the outlook for higher prices, futures need to break back above 600 and then take out shorter-term DMAs to regain upside momentum. Near-term momentum favours the downside, and we expect this to remain the case before a possible trend change is around 575.
NY 2nd Month Coffee Futures
NY coffee futures rallied on Friday, aiming to breach the 220 level; however, downside pressures prevailed later on in the day, prompting prices to close at 220.45. The stochastics are now falling after converging on the downside in the overbought. The MACD diff is positive and converging, signalling growing selling pressures. To confirm the outlook for lower prices, futures need to break back below 220, which could set the scene for futures to take out the 10 DMA level at 207.96. This would confirm the trend change. On the upside, the market needs to completely take out the resistance at 220 to target new highs. While prices remain elevated, indicators point to softening buying pressures in the near term.
Ldn 2nd Month Coffee Futures
Ldn coffee futures edged higher on Friday and managed to close above 3800 at 3852. The indicators suggest we could see lower prices in the near term. The stochastics are converging on the downside in the overbought, as the MACD diff is positive and converging. On the upside, a break above the 3900 level could test the 4000. On the downside, if futures fail into 10 DMA at 3679, then we could see futures break back below 3500. The narrowing DMA support suggests further upside potential; however, in the near term, we expect to see some softness.
NY 2nd Month Cocoa Futures
NY cocoa futures rallied on Friday as protracted buying pressure triggered a close on the front foot at 10511. The %K/%D is diverging on the upside in the overbought. The MACD diff is positive and diverging once again, suggesting a continuation of the upward trend in the near term. On the downside, a break below the key support level of 10000 could trigger losses back towards 10 DMA at 9578; a break below this level would confirm the outlook of lower prices. On the upside, futures look comfortable in breaching new highs at 10500 completely and 11000. Indicators point to further buying pressures in the near term.
Ldn 2nd Month Cocoa Futures
Ldn cocoa futures rallied on Friday as protracted buying pressure triggered a close on the front foot at 8652. The %K/%D are diverging on the upside. The MACD diff is positive and diverging, outlining recent market growth. On the downside, a break back below the trend support level could trigger losses back towards the 10 DMA at 7875; a break below this level would confirm the outlook of lower prices. On the upside, a break above 9000 could trigger gains towards new highs. The market rally has been strong, with Friday’s candle confirming the strength of bull sentiment. We could see prices trend even higher today, but support at 8500 needs to hold firm for this to be the case.
