NY 2nd Month Sugar Futures
NY sugar futures edged lower on Friday, but the risk-off momentum was moderate as futures found support at 17.71, prompting a close at 17.74. The stochastics are falling, with %K/%D edging towards oversold, and the MACD diff is negative and diverging, suggesting the outlook for lower prices. To confirm the bearish indicators and rejection of prices above 18.00, futures need to take out support at 17.71 and then target 17.50. On the upside, futures need to close above the 40 DMA at 18.20 and then test the 18.50 level in order to confirm the outlook of higher prices towards 19.00. We expect futures to remain at the lower end of the trading range in the near term.
Ldn 2nd Month Sugar Futures
Ldn sugar weakened yesterday, as protracted selling pressure triggered a close on the back foot below 500 at 498.90. The stochastics are falling, with %K/%D diverging on the downside, with the MACD diff negative and diverging. A full bearish candle with short wicks following protracted selling in recent days suggests that downside appetite is yet to show signs of slowing down. This could set the scene for lower prices to break below the 493.80 support level and would confirm the trend for falling prices down to 475. On the upside, resistance at 40 DMA at 507.04 is now capping prices, and a break above that level would strengthen the bullish momentum towards 512.60. We expect further weakness in the near term.
NY 2nd Month Coffee Futures
NY coffee futures jumped higher yesterday, managing to break above the 10 DMA resistance level of 385.86 at 398.40. The indicators point to growing buying pressures in the near term. The stochastics have converged on the upside and are now rising, sending a strong buy signal, and the MACD diff is negative and converging. We expect futures to edge higher in the near term towards 415; however, the futures first need to take out the robust level on the upside at 400. On the downside, if futures fail into 10 DMA once again, then we could see prices break back below 381.40 before the long-term trend support of 365. We expect futures to firm in the near term, and if the futures break above the 400 level completely, this could provide a strong signal on the upside.
Ldn 2nd Month Coffee Futures
Ldn coffee futures rallied yesterday as protracted buying pressure triggered a close on the front foot at 5645. The %K/%D has converged on the upside out of the oversold – a strong buy signal. The MACD diff is negative and converging, suggesting higher prices in the near term. On the downside, a break below the key support level of 40 DMA at 5442 could trigger losses back towards 5300; a break below the 100 DMA at 5061 would confirm the outlook for lower prices in the longer term. On the upside, a break above 5650 could trigger gains to 5800. Indicators point to further buying pressures in the near term, and we expect futures to follow the longer-term trend on the upside.
NY 2nd Month Cocoa Futures
NY cocoa futures opened lower but managed to close higher day-on-day at 8376. The stochastics are converging in the oversold. The MACD diff is negative and flat, indicating a lack of technical appetite in either direction. On the upside, futures need to break above the resistance levels of 200 DMA at 8386 and then 8500 to trigger the momentum. Prices would then need to take out the 10 DMA level to confirm the longer-term outlook. Conversely, appetite for prices below 8000 could trigger a test of support of 7336. Yesterday’s candle suggests that the 8000 and 100 DMA levels have created a tight range for the prices. The 8000 support level is crucial for signalling a trend change on the downside.
Ldn 2nd Month Cocoa Futures
Ldn cocoa futures opened lower yesterday; however, the momentum slowed as the prices found support at 6518 and closed at 6599, marking a November 2024 low. The stochastics are edging lower into the oversold, and the MACD diff is negative and flat, struggling to point out an outlook. 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 the 100 DMA at 6643 before 7000. On the downside, if the current support level at 6518 is broken below, the next level of support stands at 6000. We expect the recent downside momentum to slow in the near term and find support at current levels.
