NY 2nd Month Sugar Futures
NY sugar futures weakened yesterday but struggled to break below the robust support level of 19.50, prompting a close slightly above it at 19.62. The stochastics are falling; the %K/%D are edging into the oversold territory, signalling further declines. The MACD is negative and diverging, and the long candle body formation supports market decisiveness for lower prices. Previously, dips in the market have not been well bid, so in order to confirm further weakness, prices need to break below the current support at 19.50 and then target 19.20. Conversely, a break above 20.00 could set the scene for a test of 40 DMA at 20.25. We expect prices to remain on the front foot today, retesting the 19.50 level.
Ldn 2nd Month Sugar Futures
Ldn sugar futures buckled yesterday as protracted selling pressure triggered a close below the robust 540.20 level at 537.10. The stochastics are falling, and %K/%D has given a sell signal. The MACD diff is negative and diverging, confirming growing selling pressure; this could set the scene for lower prices towards the 530. A break below this level would confirm the outlook for lower prices. On the upside, a break above the 100 DMA resistance level at 548.20 and reaffirmation of support above this level could strengthen the upside momentum to 560. Futures need to take out the DMAs in order to confirm the outlook of higher prices. Yesterday’s long candle body and a close just below the robust support level indicate growing downside momentum in the near term.
NY 2nd Month Coffee Futures
NY coffee futures jumped higher yesterday but struggled to break the 340 level, resulting in a marginal weakness day-on-day and a close at 334.15. The stochastics continue to diverge on the upside, with the %K/%D now entering the overbought territory. The MACD diff is positive and diverging. A break of 320 could trigger losses through 10 DMA at 315.32, with the tertiary support level at 300. On the upside, a break above 340 could set the scene for new highs. The spinning top formation has been formed, which points to market indecisiveness. However, a jump above the 340 resistance could suggest a strengthening appetite for higher prices.
Ldn 2nd Month Coffee Futures
Ldn coffee futures opened higher but failed above 5500 resistance yesterday as intraday trading caused futures to close at 5232. The stochastics strengthened, with %K/%D converging on the upside and giving the buy signal. The MACD diff has also flipped on the upside and is now strengthening, suggesting further upside pressures. Still, the rejection of prices above 5500 has formed a candle with a narrow body and a long wick on the upside, suggesting a lack of appetite above this level. If prices were to break above it, this could trigger a test of 5569. To confirm the shooting start formation, futures need to take out 10 DMA at 5098 and then robust support at 5000. Prices need to break higher to confirm the indicators’ narrative for higher prices in the near term.
NY 2nd Month Cocoa Futures
NY cocoa gapped higher yesterday, with protracted buying pressure triggering a close above 10000 to close at 10557. Yesterday’s long candle with short wicks suggests that yesterday’s appetite was robust, and a break above the key resistance levels indicates a further appetite for higher prices. In the meantime, the stochastics are strengthening, with %K/%D edging higher in the overbought. The MACD diff is positive and diverging, suggesting further gains in the near term. To confirm this, futures must break above the 10779 level and then target 11000. Alternatively, if upside momentum weakens, a test of the 10 DMA support level will be a key gauge for the market’s appetite for lower levels.
Ldn 2nd Month Cocoa Futures
Ldn cocoa strengthened yesterday as protracted buying pressure triggered a close on the front foot above 8404. The stochastics are rising; %K/%D is diverging on the upside in the overbought. The MACD diff is positive and diverging. A long bullish candle body with short wicks suggests growing buying pressures; this could set the scene for higher prices to break above the trend resistance currently at 8500. This would confirm the trend for rising prices, up to 9000. On the downside, a breach of support at 8000 would strengthen the bearish momentum. This could also trigger losses towards the 10 DMA at 7770. Indicators point to higher prices, and we expect futures to strengthen in the near term.
