NY 2nd Month Sugar Futures
NY sugar futures held their nerve yesterday as markets tested the support of 20.08 once again, causing the market to close slightly above it at 20.31. The stochastics are falling after converging on the downside, and the MACD diff is negative and flat, suggesting lower prices in the near term. To confirm the outlook for lower prices, futures need to close back below the key 20.08 and then target 20.00. The 100 DMA is closing in and supporting prices from the downside. On the upside, a break above the 10 DMA at 20.51 could set the scene for 20.76. The narrow candle body with a longer lower wick points to a lack of appetite on the downside, but the futures need to break above current resistance to confirm the near-term outlook.
Ldn 2nd Month Sugar Futures
Ldn sugar futures opened lower but struggled to break below the trend support of 562, prompting a close higher day-on-day at 566.50. The stochastics are falling, soon to enter the oversold territory, which could suggest a continuation of moderate softness in the near term. The MACD diff is negative and diverging. On the upside, futures need to break above the robust resistance levels of 40 DMA at 571.76 and 10 DMA at 573.61 to trigger the momentum. Prices would then need to take out the 580.70 level to confirm the longer-term outlook on the upside. Conversely, appetite for prices below the trend support and 560 could trigger a test of support of 100 DMA at 547.69. A dragonfly doji candle shows rejection of lower prices and could point to confirmation of trend support at current levels. We expect the medium-term trend on the downside to persist, but prices could gain marginal momentum in the near term.
NY 2nd Month Coffee Futures
NY coffee futures strengthened yesterday as protracted buying pressure triggered a close above the 10 DMA at 247.29. The %K/%D diverging on the upside out of the oversold. Likewise, the MACD diff is negative and converging, confirming waning selling pressures. On the upside, finding support above the 10 DMA could trigger gains through 40 DMA at 254.32 towards 260. On the downside, a break below the 100 DMA at 243.97 level could trigger losses back towards 240. That level has been supporting futures prices, and a break below it would signal strong selling pressure. A longer upper wick signals that the buying pressure is growing, and a bullish outlook is on the horizon.
Ldn 2nd Month Coffee Futures
Ldn coffee edged higher yesterday as intraday trading caused futures to test appetite at 10 DMA 4388, but struggling above it and closing at 4372. Stochastics are rising, and %K/%D is seen converging on the upside out of the oversold, confirming positive momentum. The MACD diff is negative and converging. The indicators suggest an end to the recent bearish trend in the near term. To maintain positive momentum, prices need to close above 10 DMA and then target 4500. On the downside, the rejection of prices above 10 DMA could trigger losses back to 4338 before targeting 4200. Buying pressure remains weak, and the doji candle confirms market uncertainty. The break above the resistance of 10 DMA could confirm the outlook of stronger prices.
NY 2nd Month Cocoa Futures
NY cocoa futures held their nerve yesterday as intraday trading caused the market to close in line with the key resistance at 6946. The stochastics are rising, and the MACD diff is positive. The %K/%D is also rising further into the overbought; however, the upside momentum is stalling. On the downside, futures need to close back below the support and then target 6720. The 10 DMA is start closing in and support prices from the downside. On the upside, if resistance at 6946 is broken above, this could trigger gains back towards 7000. A break above this level would confirm the trend on the upside. Narrow-bodied candles in recent sessions point to market uncertainty, and futures need to break out of current resistance/support to confirm the longer-term outlook.
Ldn 2nd Month Cocoa Futures
Ldn cocoa futures edged lower yesterday but struggled below 5359 once again, causing the market to close at 5393. The stochastics are rising, with %K/%D diverging on the upside in the overbought, but the upside momentum is stalling. The MACD diff is positive and flat, suggesting we could see prices flatten out in the near term. To confirm the outlook for higher prices, futures need to close above 550 and then target the 100 DMA at 5953. The 10 and 40 DMAs are closing in and supporting prices from the downside. However, a break below 5000, the support level the prices struggled to break last week, could set the scene for lower prices in the longer term. The narrow candle body with a longer lower wick alongside waning bullish indicators points to market uncertainty about prices in either direction. We expect futures to hold above the near-term support today as near-term momentum wanes.
