NY 2nd Month Sugar Futures
NY sugar futures opened higher on Friday, but resistance of 21.00 caused futures to close lower on the day at 20.52. The stochastics are seen falling on the downside, with %K/%D about to converge on the downside in the overbought, and the MACD diff is positive and converging marginally. A break of the 20.50 level could trigger losses through 100 DMA at 20.31, with the tertiary level at 10 DMA. On the upside, a break above 21.00 could set the scene for bullish momentum towards highs not seen since April. The indicators point to a reversal of momentum to the downside; however, futures have struggled to break support at 20.50 in recent sessions. We expect futures to test the 100 DMA level today.
Ldn 2nd Month Sugar Futures
Ldn sugar futures failed above the previous day’s highs on Friday as moderate selling pressure caused futures to close at 571.70. The stochastics are falling, with %K/%D converging on the downside back out of the overbought, and the MACD diff is about to converge on the downside, suggesting lower prices in the near term. Indeed, the reaffirmation of resistance at 580.70 on Friday has formed a shooting star candle, suggesting a waning appetite for higher prices. If prices were to break back above this robust level, this could trigger a test of the 600 level. On the downside, futures need to take out 100 DMA at 570.73 and then robust support at 10 DMA at 565.78. The indicators are pointing to a change of momentum on the downside; to confirm this, the futures need to break below the 100 DMA support first.
NY 2nd Month Coffee Futures
NY coffee futures opened higher on Friday, above the 10 DMA resistance level. However, the resistance at 233.35 capped the upside once again, prompting futures to close at 228.95. The %K/%D just converged on the upside. The MACD diff is negative and converging, suggesting we could see higher prices in the near term. To confirm this, futures need to break above 233.35, a firm resistance, to trigger the momentum. A break above this level towards 240 would confirm the growing bullish momentum. Conversely, appetite for prices back below the 10 DMA level could trigger a test of support at 40 DMA at 220.25. A gravestone doji candle shows rejection of higher prices as futures struggle above that level; if the resistance is broken, we expect prices to strengthen in the near term.
Ldn 2nd Month Coffee Futures
Ldn coffee futures gained ground on Friday but struggled above 4200 to close at 4185. The stochastics are rising, with the %K/%D diverging on the upside, as the MACD diff is negative and converging, which suggests waning selling pressures. To confirm another further bullish candle, futures must first breach the 4200 level before testing the 4338 level. On the downside, the candle found support at 10 DMA at 4104, and if the prices break through this level, we could see a retreat to 4000 before 40 DMA at 3961. The bullish candle with longer upper and lower wicks points to a lack of appetite above the 4200 level. We expect futures to retest this level today.
NY 2nd Month Cocoa Futures
NY cocoa futures held their nerve on Friday as intraday trading caused the market to close below 10 DMA at 7850. The stochastics have converged on the upside, 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 break above the 10 DMA at 7810 completely and then target the 40 DMA at 8276. The 10 DMA is starting to close in and resist prices on the upside. On the downside, the rejection of prices around 7025 could trigger losses back towards 6500. A break below this level would confirm the downward trend. Narrow-bodied candles in the last couple of sessions point to market uncertainty, and the futures need to break out of current resistance/support to confirm the longer-term outlook.
Ldn 2nd Month Cocoa Futures
Ldn cocoa edged higher on Friday as moderate bullish sentiment caused futures to close above the 10 DMA resistance at 6548. Stochastics are rising, with %K/%D diverging on the upside out of the oversold territory, confirming a possible change of trend in the near term. The MACD diff is negative and converging. To maintain positive momentum, prices need to break completely above the 10 DMA level at 6429 and then target 40 DMA at 6797. On the downside, a break below the robust support at 6000 could trigger losses to 5359. Buying pressure has been marginal as prices struggled to break above the 10 DMA level; however, indicators point to a continuation of the buying pressure in the near term. We expect prices to edge higher.
