NY 2nd Month Sugar Futures
NY sugar futures held their nerve yesterday as intraday trading saw futures remain below the 10 DMA level. This level held firm, and the future closed at 19.29. The stochastics are now converging on the downside, with %K/%D edging towards the oversold, and the MACD diff is flat, suggesting that the recent moderate upside might be waning. To confirm the outlook for lower prices, futures need to break below the support at 19.20, which could set the scene for futures to test 19.00. On the upside, the market needs to take out the resistance of 10 DMA at 19.45 and then resistance at 19.80. The recent day’s trade kept within the band of resistance/support that is holding prices constrained. We do not expect prices to break out of the current range in the near term.
Ldn 2nd Month Sugar Futures
Ldn sugar futures held their nerve yesterday, causing the market to close at 546.50. The stochastics are flattening out, with %K/%D’s upside stalling, as the MACD diff is negative and converging, suggesting an appetite for higher levels might be waning. To suggest the outlook of higher prices, futures need to close back above the 10 DMA at 548.38 and then target 560, the recent high. On the downside, a break below 540.20 could set the scene for lower prices. Narrow candle body trading in recent sessions points to market uncertainty about the direction of the move, and the futures need to break out of current resistance/support to confirm the near-term outlook.
NY 2nd Month Coffee Futures
NY coffee sold off sharply yesterday as protracted selling pressure triggered a close on the back foot at 206.10. The stochastics are falling, and %K/%D is diverging on the downside in the oversold. The MACD diff is negative and diverging. The break below the current support of 40 DMA at 204.83 could set the scene for lower prices towards the 200 level. A break below this would confirm the trend for falling prices. On the upside, resistance at 10 DMA has proven to be strong, and a break above that level would strengthen the bullish momentum. This could also trigger gains towards the 230. While the support level at 40 DMA was held firmly yesterday, the indicators suggest that there might be a greater appetite to keep prices at lower levels.
Ldn 2nd Month Coffee Futures
Ldn coffee futures sold off yesterday as a lack of appetite for higher prices helped to break the 3800 support; the market closed at 3680. Stochastics continue to fall, with %K about to enter the oversold territory, suggesting further selling momentum in the near term. MACD diff is negative and diverging, supporting the outlook for deteriorating prices. In the last two days, futures broke below robust support levels, a sign of an impending market downturn. The sell-off yesterday and close near the lows suggest further selling pressure. However, futures must first breach the 40 DMA at 3680 to confirm this. On the upside, support at current levels would aid the market pause. We believe that the market will keep Ldn coffee prices subdued today.
NY 2nd Month Cocoa Futures
NY cocoa futures gapped lower yesterday, breaking below the 8000 level, causing the market to close at 7563. The stochastics are falling, with %K/%D diverging on the downside and now falling into the oversold, and the MACD diff is negative and diverging, suggesting lower prices in the near term. To confirm this momentum, a break below support at 7500 could set the scene for 7000. On the upside, futures need to close back above the 8000 level and then target 40 DMA. The narrow candle body with longer wicks points to a lack of appetite below the new support level while the negative trend is continuing.
Ldn 2nd Month Cocoa Futures
Ldn cocoa futures gapped lower yesterday, breaching the 7000 level to close at 6555. The stochastics are falling, with %K/%D now falling in the oversold, and the MACD diff is negative and diverging, suggesting lower prices in the near term. To confirm this momentum, a break below support at 6500 could set the scene for the 6000 level. On the upside, to suggest the outlook of higher prices, futures need to close back above the 40 DMA at 7468 and then target 8000. A longer candle body with short wicks suggests ample appetite for lower levels, and the indicators confirm further softness in the near term.
