NY 2nd Month Sugar Futures
NY sugar futures held their nerve yesterday as intraday trading saw prices close at 15.88. The RSI is rising, and %K/%D is positive and diverging out of the oversold, suggesting further bullish momentum. The MACD diff is negative and converging, highlighting waning selling pressure. The indicators point to higher prices in the near term, and to confirm appetite for higher prices, futures need to break above 16.00– the level previously rejected – which could then trigger a test of resistance of 16.69. On the downside, the rejection of the support at 10 DMA at 15.71 could see prices test the trend support at 15.50. A break below this level towards the 15.29 would confirm the strong bearish momentum. A positive doji candle after a bearish candle signal market uncertainty and prices struggling to break out of the current trading range, a break out of which would set the scene for strong momentum. We anticipate prices on the front foot in the near term.
Ldn 2nd Month Sugar Futures
Ldn sugar futures strengthened yesterday as protracted buying pressure triggered a close on the front foot at 448.20. The RSI is rising, while %K/%D is diverging on the upside. The MACD diff is negative and converging, confirming rising buying pressures. On the downside, a break completely below the key support levels of 40 and 10 DMA at 445.64 and 445.18 could trigger losses back towards 440; break below this level would confirm the outlook of lower prices in the longer term. On the upside, a break above the 449.60 could trigger gains through 452.80. Since the end of February, the market traded the narrow range and lacked conviction for a trend change; however, indicators highlight that the selling pressure is subsiding, and the bullish outlook is on the horizon.
NY 2nd Month Coffee Futures
NY coffee futures gained ground yesterday as buying pressure triggered a close on the front foot at 134.50. The stochastics are rising with the %K/%D diverging on the upside, as the MACD diff is negative and converging on the upside. This suggests we could see higher prices in the near term towards 140, but the market needs to take out immediate resistance of 135.45. On the downside, the candle found support at 10 DMA 131.62, and if the prices break through this level, we could see prices retreat back through the 131 before 40 DMA at 129.50. However, the market was well supported above that level in recent weeks, and the bullish engulfing pattern suggests a strong buy signal. Firm support at that level suggests a lack of appetite below, and we expect prices to firm in the near term.
Ldn 2nd Month Coffee Futures
London futures gained ground yesterday as protracted buying pressure prompted a test of 10 DMA resistance level at 1400 once again to close above at 1406. The stochastics are rising, and the %K/%D have converged on the upside, a buy signal in the near term. The MACD diff is also seen converging; however, it lacked the conviction to suggest an improving sentiment. To confirm another bullish candle, futures need to break above the 10 DMA and trend resistance and then target 1430. On the downside, the break below the 23.6% fib level of 1385.57 could set the scene for lower prices towards the support of 40 DMA at 1379. Long bullish candle and higher highs signal growing buying pressures, but futures need to take out this level in order to confirm the outlook on the upside.
NY 2nd Month Cocoa Futures
NY cocoa futures gained ground yesterday as buying pressure prompted a test of 2250. The market closed at 2526. The stochastics are decreasing, with %K edging below the oversold, and the MACD diff is negative and diverging, suggesting bearish momentum in the near term. The prices have been supported above the 40 DMA at 2509. The fall below this level could trigger losses through 2500 and 2482. On the upside, a breach back above 10 DMA at 2571 would bring into play the recent firm resistance of 61.8% fib level at 2612.97, creating an inverse hammer formation. Futures need to take out the resistance at 2667 in order to confirm the long term trend. The convergence of DMAs provides strong support/resistance for prices, and if 40 DMA remain firm, we could see prices edge higher.
Ldn 2nd Month Cocoa Futures
Ldn cocoa futures weakened yesterday after investors rejected prices above 2434, prompting a close below at 2413. The stochastics are falling, with RSIs in neutral territory; the %K is trading in the oversold territory, suggesting a short-term negative trend. The MACD diff is negative and diverging, indicating improving sentiment on the downside. To confirm the three crows formation, prices need to break below the support level at 2400 before the 2373 level. Secondary support stands at 40 DMA 2362, a break below would confirm the outlook on the downside. On the upside, to regain upside conviction, futures need to close back above 10 DMA at 2447 and then 2500 in the near term. Near term momentum is on the downside, and the indicators confirm this trend.