NY 2nd Month Sugar Futures
NY sugar futures softened on Friday after testing the support level of 15.62. The market closed marginally higher at 15.72. The stochastics are rising, with %K/%D just converging on the upside out of the oversold territory, and the MACD diff is negative and converging, paving the way for higher prices in the near term. The reaffirmation of support at 15.79 could set the scene for higher prices back to test the 16.00 level – March highs. On the downside, futures need to break below the support of 15.50 in order to confirm the bearish trend. The 10 DMA has just crossed below the 40 DMA level, sending a sell signal; however, prices need to break out of the current resistance/support to confirm the trend.
Ldn 2nd Month Sugar Futures
Ldn sugar futures softened on Friday after prices failed above the 449.60 level, prompting a close on the back foot at 446.60. The stochastics are rising and diverging out of the oversold, and the MACD diff is converging on the upside, outlining the strength in the market. Selling pressure has been moderate, and the 40 DMA level has been capping losses on the downside. However, yesterday's long lower wick suggests an increased appetite for lower prices below 10 and 40 DMA. A break below these levels could set the scene for 440, to then target 434.20. Alternatively, if prices can gain a footing above the 449.60 levels, the bulls could then target 459.80 in order to regain upside conviction. We anticipate prices to remain supported above the current support levels in the near term.
NY 2nd Month Coffee Futures
NY coffee futures gained ground on Friday as buying pressure triggered a close on the front foot above 10 DMA at 133. The stochastics are rising with the %K/%D converging on the upside out of the oversold, as the MACD diff is negative and converging on the upside, outlining growing buying pressures. This suggests we could see higher prices in the near term towards 135, but the market needs to take out immediate resistance of 133.90. On the downside, the candle found support at 131, and if the prices break through this level, we could see futures retreat back through the 40 DMA at 129.33 before 125.80. Another bullish candle would create a three white soldier formation and a break above the 10 DMA signals that we could see further bullish momentum in the near term.
Ldn 2nd Month Coffee Futures
Ldn coffee weakened on Friday, as protracted selling pressure triggered a close on the back foot at 1403. The stochastics are rising, with %K/%D converging on the upside, whereas the RSI has edged lower. The MACD diff is negative, however, lacks the conviction to suggest an outlook. A full bearish candle with a long lower wick suggests growing selling pressures; this could set the scene for lower prices to break below the 23.6% fib level at the 1385.57 support level. This would confirm the trend for falling prices, down to the 40 DMA at 1376. On the upside, resistance at 10 DMA at 1412 has proven to be strong, and support above that level would strengthen the bullish momentum. This could also trigger gains towards 1430. Narrowing support and resistance levels are creating a narrow trading range, but we believe that the prices will edge marginally lower today.
NY 2nd Month Cocoa Futures
NY cocoa futures failed into 2575 on Friday as prices closed at 2570. The stochastics are falling, and the MACD diff has converged on the downside, a clear sell signal. The rejection of higher prices may prompt a break back towards 2523; a subsequent breach of this level could trigger losses towards 50% fib level at 2513.50. On the upside, a break of 10 DMA at 2593 may prompt futures to retest 2600. A subsequent breach of this level would prompt prices to regain upside momentum. The futures struggled above 10 DMA, and with indicators pointing to further bearish momentum, we expect prices to weaken in the near term.
Ldn 2nd Month Cocoa Futures
Ldn cocoa futures edged lower on Friday after futures tested 10 DMA once again to close at 2462. The stochastics are falling towards oversold, and the MACD diff is negative and diverging, suggesting lower prices in the near term. To confirm the bearish indicators and rejection of prices above 10 DMA, futures need to take out support at 2450 and then target 38.2% fib level at 2434. On the upside, futures need to close above 10 DMA at 2475 and then target 2500 in order to confirm the outlook of higher prices towards 2531. Long lower wick points to an appetite for lower prices. We expect futures to weaken in the near term back.