NY 2nd Month Sugar Futures
NY sugar futures opened lower day-on-day but gained marginal ground as prices defended the psychological support of 17.00 to close at 17.15. The %K/%D are oversold but seen converging, which could be a signal for a change of momentum. The MACD diff is negative and converging, suggesting further appetite for higher prices, but futures need to break above the near-term resistance of 10 DMA at 17.37 to trigger the momentum. Prices would then need to take out the 40 DMA level at 17.68. Conversely, appetite for prices below 17.00 could trigger a test of January lows of 16.64. A dragonfly doji candle shows rejection of lower prices and could point to an end of bearish sentiment we have seen in the last couple of weeks. We anticipate a change of momentum in the near term.
Ldn 2nd Month Sugar Futures
Ldn sugar futures held their nerve yesterday after testing the support level of 464 – a January low. The market closed above this level at 469.20. The stochastics are showing signs of stalling downside pressures, with %K/%D converging on the upside in the oversold, as the MACD diff is negative and converging. A break below the 464 could set the scene for a test of the 460 level – a new low. On the upside, futures need to break above the near-term resistance of 10 DMA at 476.87 in order to confirm the upside trend, confirming the hammer formation. Indeed, the 464 support level looks to be robust in the meantime, and a hammer candle formation could point to upside momentum in the near term.
NY 2nd Month Coffee Futures
NY coffee futures edged lower yesterday as prices failed above the trendline level, currently at 340, closing below it at 338.60. The indicators are starting to favour the upside; the stochastics are beginning to rise, with %K/%D converging in the oversold area, and the MACD diff is negative and converging, confirming waning selling pressures. To confirm this, futures must break above the trendline at 340 and then target the 10 DMA at 352.63. Alternatively, the next robust level on the downside now stands at 314 – a January low. Indicators point to a weakening bearish momentum, and we expect the downside to slow in the near term.
Ldn 2nd Month Coffee Futures
Ldn coffee futures weakened yesterday, continuing from the momentum of the previous days. However, the support at 4338, which marks the October 2024 low, held firmly, prompting futures to close at 4337. The stochastics are showing signs of a potential trend reversal, with the %K converging on the upside, and the MACD diff is negative and converging, suggesting we could see higher prices in the near term. A break back above the 4500 level could bring into play the 4664, which could set the scene for resistance at 5000 in the longer term. On the downside, futures need to weaken back below 4338 in order to confirm downside momentum. The reaffirmation of resistance at this level could trigger losses towards July 2024 lows of 4000. A longer lower wick, where most of the trading took place in the upper ranges, points to a lack of appetite for further losses. We expect prices to start to show signs of a trend change in the near term.
NY 2nd Month Cocoa Futures
NY cocoa strengthened yesterday, supported by the 200 DMA of 8671, prompting a close on the front foot at 9158. The stochastics are converging, with %K/%D tailing off in the oversold. The MACD diff is negative and converging. A long bullish candle body with a longer lower wick suggests growing buying pressures; this could set the scene for higher prices to break above the resistance at 10 DMA at 9388. This would confirm the trend for rising prices, up to the 10000 level. On the downside, a breach of support at 200 DMA would strengthen the bearish momentum. This could also trigger losses towards the 8000. Indicators point to higher prices, but the 10 DMA resistance is crucial to suggest further gains.
Ldn 2nd Month Cocoa Futures
Ldn cocoa edged higher yesterday as intraday trading caused futures to close at 6359. Stochastics are tailing off, with %K/%D seen converging on the upside in the oversold. Likewise, the MACD diff is negative and converging, highlighting a potential change in trend in the near term. To confirm another bullish candle, prices need to close above 6518 and then target 200 DMA resistance at 6659. On the downside, the rejection of prices above these levels could trigger losses back to 6000. Buying pressure was weak, and the inside candle suggests there might be a lack of appetite above the previous day’s highs. The indicators are about to confirm a change of trend in the near term, but futures need to break above the near-term resistance to confirm this.
