NY 2nd Month Sugar Futures
NY sugar futures struggled to break below the 19.00 support on Friday, and we saw prices close at 19.09 as a result. The stochastics are now rising, with %K/%D seen diverging on the upside out of the oversold, and the MACD diff is negative and converging marginally, suggesting a growing appetite for higher prices, but futures need to break resistance of 10 DMA at 19.44 to trigger the momentum. A break above this level towards 19.80 would confirm the stronger positive momentum. Conversely, appetite for prices below 19.00 could trigger a test of support of 18.50. A gravestone doji candle shows rejection of lower prices but it lacked conviction to break above the 10 DMA level. We expect prices to remain range-bound, capped by a 10 DMA level in the near term.
Ldn 2nd Month Sugar Futures
Ldn sugar futures held their nerve on Friday as intraday trading saw prices close at 542.40. The %K and %D are about to leave the oversold, which could be a strong buy signal. The MACD diff is negative and converging, suggesting some appetite for higher prices, but futures need to break above the 10 DMA at 551.03, a firm resistance, to trigger the momentum. A break above this level towards 570 would confirm the strong bullish momentum and a trend reversal. Conversely, appetite for prices below the 540.20 level could trigger a test of support at 520. A gravestone doji candle shows rejection of higher prices and could point to an end of the moderate bearish sentiment we have seen in the last couple of days. To confirm this, the resistance at 10 DMA has to be broken above first.
NY 2nd Month Coffee Futures
NY coffee softened on Friday, as moderate selling pressure triggered a breakthrough of 10 DMA, and closed on the back foot at 224. The stochastics are falling, with %K%D softening in the neutral territory, highlighting the recent selling pressure. The MACD diff just flipped on the downside, a strong sell signal, suggesting increasing downside pressures; this could set the scene for lower prices towards the 220 support level. A break below this would confirm the trend for falling prices, down to 212.20. On the upside, a resistance at 10 DMA is now holding firm, and a break back above that level would strengthen the bullish momentum. This could also trigger gains towards the recent highs of 240. A short candle body along with a longer lower wick point to an increased appetite on the downside; however, the futures need to break completely below the 220 to confirm the outlook.
Ldn 2nd Month Coffee Futures
Ldn coffee weakened on Friday, as protracted selling pressure triggered a close on the back foot above the 10 DMA at 4151. The stochastics are falling, and the MACD diff is positive and converging, suggesting a possible trend change. A full bearish candle suggests growing selling pressures; this could set the scene for lower prices to break below the 10 DMA support level at 4123. This would confirm the trend for falling prices, down to 4000. On the upside, resistance at 4200 is now standing firm once again, and a break above that level would strengthen the bullish momentum. This could also trigger gains towards 4500. The bearish engulfing pattern suggests an impending market downturn, and to confirm the change of trend in the longer term, futures must first breach the 10 DMA level before targeting 4000.
NY 2nd Month Cocoa Futures
NY cocoa futures edged lower on Friday after futures tested the 10 DMA once again to close at 10594. The stochastics are falling out of the overbought, and the MACD diff is negative and diverging, suggesting lower prices in the near term. To confirm the bearish indicators and rejection of prices above 10 DMA, futures need to take out support at 10500 and then target 10000. On the upside, futures need to close above 10 DMA and then target 11000 in order to confirm the outlook of higher prices towards recent highs of 11722. A longer upper wick points to a lack of appetite below the 10 DMA. Prices need to take out current support to confirm the outlook for lower prices. We expect futures to remain elevated in the near term.
Ldn 2nd Month Cocoa Futures
Ldn cocoa futures edged lower on Friday after prices broke below the robust trendline support, prompting a close at 8779. The stochastics are falling, with %K/%D edging out of the overbought, and the MACD diff is negative and diverging, confirming the outlook for lower prices. To confirm the bearish indicators, futures need to break below the support at 9000 and then target 8500. On the upside, the 10 DMA level needs to be broken back above in order to confirm the outlook of higher prices. We expect prices to weaken in the near term.
