NY 2nd Month Sugar Futures
NY sugar futures opened lower yesterday, but support at 18.63 prompted futures to edge slightly higher and close at 18.88. The stochastics continue to fall, with %K/%D diverging on the downside, and the MACD diff is positive and converging, about to flip into a negative category. However, the indicators’ downside momentum is stalling, and yesterday’s hammer formation might point to a potential trend change in the near term. To confirm this, futures need to break above the near-term resistance of 19.00 before the 10 DMA at 19.29 in order to confirm the upside trend. Indeed, the 10 DMA support level has been robust in the last couple of sessions, capping any strong upside gains. Alternatively, further weakness could test the 18.00 level before new lows. We expect futures to remain at the lower end of recent trading ranges.
Ldn 2nd Month Sugar Futures
Ldn sugar futures opened lower following the recent sell-off; however, the momentum is seen slowing as the prices found support at 525 and closed at 528.90. The stochastics continue to edge lower close to the oversold, and the MACD diff just converged on the downside, although the pace of the decline is seen stalling. The candle formed a longer lower wick, a hammer formation, and could be a sign of a trend reversal in the near term. If this materialises, the levels could break back above 540 before 10 DMA at 542.76. On the downside, if the current support level at 525 is broken below, the next level of support stands at 500. We expect the recent downside momentum to slow in the near term and find support at current levels.
NY 2nd Month Coffee Futures
NY coffee futures strengthened yesterday as futures rejected prices below the 100 DMA level at 194.32 and closed on the front foot at 200.85. The indicators point to a potential trend change in the near term, with %K/%D converging out of the oversold area as the MACD diff is negative and converging, signalling growing buying pressures. On the upside, finding support above the 200 completely could trigger gains through 40 DMA at 207.59 to 212.20. On the downside, a break below the 100 DMA level could trigger losses back towards 190. That level has been supporting futures prices, and a break below it would signal strong selling pressure. Indicators suggest that buying pressures are growing, and the bullish outlook is on the horizon.
Ldn 2nd Month Coffee Futures
Ldn coffee futures held their nerve yesterday as moderate buying pressure prompted a close at 3433. The stochastics are now rising, with the %K/%D now converging on the upside, highlighting waning selling pressures. The MACD diff is negative and converging. To confirm another bullish candle, futures need to close above the robust resistance at 3460 and then target 10 DMA at 3516. On the downside, the break below the current support level of 100 DMA could set the scene towards 3240. However, the market struggled below the level in recent sessions, and a break below is needed to confirm the bearish outlook in the near term.
NY 2nd Month Cocoa Futures
NY cocoa futures held their nerve yesterday after the support of 7025 held firmly, prompting futures to close at 7322. The stochastics are falling once again, with %K/%D just converging on the downside into the oversold territory, reflecting the sell-off that took place on Monday. The MACD diff is negative and converging. The reaffirmation of support at 7025 today could set the scene for higher prices back to test the 10 DMA level at 8090, confirming an inverse hammer formation. On the downside, futures need to break below the support of 7025 in order to confirm the bearish trend. Indeed, the near-term support level has been robust in the last couple of sessions; a break below this level would suggest strong conviction on the downside. The longer upper wick with a narrow body confirms the support is still intact.
Ldn 2nd Month Cocoa Futures
Ldn cocoa futures held their nerve yesterday after testing the support level at 6000. The market closed higher day-on-day at 6149. The stochastics are falling, with %K/%D just converging on the downside in the oversold, and the MACD diff is negative and diverging, suggesting further downside momentum. This could prompt some weakness to 5873 before 5000. Alternatively, the reaffirmation of support at these levels could set the scene for higher prices back to retest 10 DMA at 7078, confirming an inverse hammer formation.
