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Non-independent Research Daily Softs Technical Charts

Non-independent Research

Daily Softs Technical Charts

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NY 2nd Month Sugar Futures

NY sugar futures held their nerve yesterday as intraday trading caused the market to close at 15.76. The stochastics are rising, with %K edging towards the overbought, and the MACD diff is positive and diverging, suggesting higher prices in the near term. The RSI is also rising; to confirm the outlook of higher prices, futures need to close back above 15.79 and then target 16.00. On the downside, rejection of prices around 15.80 could trigger losses back towards 15.50. A break below this level and a test of 10 DMA at 15.34 would confirm the trend on the downside. Two narrow-bodied candles in the last couple of sessions point to market uncertainty, and the futures need to break out of current resistance to confirm the longer-term outlook.

Ldn 2nd Month Sugar Futures

Ldn sugar futures consolidated yesterday as buying pressure prompted resistance at the 457, triggering a close at 454.80. The stochastics are rising, with the %K trading in the overbought territory, outlining the improvement in positive sentiment. The MACD is positive and diverging, supporting the outlook for growing buying pressure. In order to confirm the full candle on the upside, and the positive indicators, prices need to take out the recent highs of 457 today, which could pave the way for a test of 460 resistance level. On the downside, apprehension amongst traders at 460 could trigger a break below 449.60 setting the scene further losses towards the 10 DMA at 442.95. A breach of this level would confirm the downside trend. A close back above recent highs today would regain upside conviction and pave the way for further gains.

NY 2nd Month Coffee Futures

NY coffee futures edged lower yesterday as prices failed above the previous day's closing price and then closed below at 125. The indicators are favouring the downside; the stochastics are falling, with %K/%D converging on the downside and edging close to the oversold area, and the MACD diff is negative and diverging on the downside, confirming further selling pressures. A break below the 124 would bring into play the support at 122.40. On the upside, prices need to find support above 10 and 40 DMA at 126.18 and 126.34 respectively before targeting 128 in the near term. Indicators point to further bearish momentum, and a cross of shorter-term DMA below the longer-term one confirms this outlook. A wedge pattern formation could persist, and we expect prices to weaken in the near term.

Ldn 2nd Month Coffee Futures

Ldn coffee futures gained ground yesterday as protracted buying pressure prompted a test of the 1372 level to close on the front foot at 1365. The stochastics are rising, and the %K seen in the overbought territory, highlighting growing buying pressures. The MACD diff is positive and diverging. To confirm another bullish candle, futures need to close above 1360 and then target the 23.6% fib level at 1385. On the downside, the break below 1350 could set the scene for lower prices towards the support of 100 DMA level at 1345. However, the market struggled below that level in recent sessions, and the bullish engulfing pattern suggests a strong buy signal. We believe that prices will strengthen in the near term.

NY 2nd Month Cocoa Futures

NY cocoa futures softened yesterday after prices failed above the 10 DMA level, prompting a close on the back foot at 2430. The stochastics are falling and diverging, with %K in the oversold territory, and the MACD diff is also diverging on the downside, outlining the weakness in the market. Selling pressure has been strong, yesterday's close below the key support levels suggests an increased appetite for lower prices. A break of 38.2% fib level at 2414 could set the scene for lower prices at 2400. Alternatively, if prices can gain a footing back above the 10 DMA level at 2461, the bulls could then target 40 DMA at 2486 in order to regain upside conviction. We anticipate prices to remain on the back foot in the near term.

Ldn 2nd Month Cocoa Futures

Ldn cocoa futures edged lower yesterday after futures tested 10 DMA once again to close at 2276. Stochastics are rising, and %K/%D converged on the upside, confirming positive momentum. The MACD diff is negative and converging, suggesting waning selling pressure. To confirm the bullish indicators and rejection of prices below 40 DMA, futures need to take out resistance at 10 DMA at 2283 and then target trend resistance at 2290. On the downside, futures need to close below 40 DMA at 2265 and then target 100 DMA at 2256 in order to confirm the outlook of lower prices. Long upper wick points to an appetite for higher prices; however, weakness prevailed during the day. Prices need to take out current resistance to confirm the outlook for higher prices.

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Disclaimer

This is a marketing communication. The information in this report is provided solely for informational purposes and should not be regarded as a recommendation to buy, sell or otherwise deal in any particular investment. Please be aware that, where any views have been expressed in this report, the author of this report may have had many, varied views over the past 12 months, including contrary views.

A large number of views are being generated at all times and these may change quickly. Any valuations or underlying assumptions made are solely based upon the author’s market knowledge and experience.

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