NY 2nd Month Sugar Futures
NY sugar futures edged lower on Friday, causing the market to close at 16.66. The stochastics are falling, with %K entering the oversold, and the MACD diff is negative and diverging, suggesting lower prices in the near term. To confirm the outlook of lower prices, futures need to close below 16.46, then target trend support at 16.44. The 10 and 40 DMAs are closing in and we expect them to provide resistance in the medium term. However, a break back above 16.85 could set the scene for 17.00 and then 40 DMA at 17.31. The narrow candle body with long upper and lower wicks points to market uncertainty about the direction of the move, and the futures need to break out of current support to confirm the near-term outlook for lower prices.
Ldn 2nd Month Sugar Futures
Lnd sugar futures edged lower on Friday as prices struggled to break below 435 once again, and the market closed at 436.40. The stochastics are falling, with %K/%D seen diverging on the downside in the oversold, and the MACD diff is negative and diverging, outlining the recent decline in prices after the rejection of prices at the 440 level. The reaffirmation of support above that level could trigger gains towards the 23.6% fib level at 448.02 and 100 DMA at 449.09. In the long run, resistance at 40 DMA at 458.99 needs to be broken to regain upside conviction. Conversely, a breach of support at 435 may set the scene for lower prices to 427.60. If futures take out of this level, this would reaffirm the trend on the downside. We expect prices to weaken in the near term.
NY 2nd Month Coffee Futures
NY coffee futures edged higher on Friday as intraday trading saw prices close at 151.95. The stochastics remain oversold, but are seen converging on the upside, and the MACD diff is negative and diverging. A break of the 23.6% fib level at 151.58 could trigger losses through 150, with the secondary level at 146.95. On the upside, a break back above 40 DMA at 152.27 and then a test of previous session highs at 154.75 could set the scene for bullish momentum. After breaking below 40 DMA support, the prices struggled to remain the downside conviction, outlined by the spinning top formation, however, if futures break below 150, we could see stronger bearish momentum.
Ldn 2nd Month Coffee Futures
Ldn coffee edged higher on Friday as moderate bullish sentiment caused futures to test appetite for prices above 10 DMA, closing above at 1616. Stochastics are falling, yet converging, with %K/%D converging close to the oversold territory, confirming a change of trend in the near term. The MACD diff is negative and diverging. To maintain positive momentum, prices need to break completely above 10 DMA level at 1614 and then target 1642 - last week's highs. On the downside, the rejection of prices above 10 DMA could trigger losses below 1600 before targeting 1581. Buying pressure subsided as prices struggled to break above the 10 DMA level; however, indicators point to a continuation of the selling pressure. The break below 1600 could strengthen the outlook of lower prices.
NY 2nd Month Cocoa Futures
NY cocoa futures softened on Friday after prices failed above the 2400 level, prompting a close on the back foot at 2372. The stochastics are falling and diverging back down to the oversold, and the MACD diff is also diverging on the downside, outlining the weakness in the market. Selling pressure has been strong in recent weeks, and Friday's long upper wick suggests bears took over the session and have the appetite for lower prices. The support at the 2355 level has been robust in the last couple of sessions, however, we do not expect this level to remain to hold. A break below this level could set the scene for 2317. Alternatively, if prices can gain a footing above the 2400 levels, the bulls could then target 10 DMA at 2410 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 held their nerve on Friday as futures tested appetite at 2266. This level held firm, and the future closed at 2249. The stochastics are falling, with %K trading in the oversold, and the MACD diff is negative and diverging, signalling growing selling pressures. To confirm the outlook for lower prices, futures need to break below the support at 2230 could set the scene for futures to take out the 38.2% fib level at 2211. On the upside, the market needs to take out resistance of 2277 and then at 10 DMA at 2279. The candle found support below 2250, and a long upper wick signals that while there is an appetite for higher prices, the bears took over. If the futures break below the current support, we could see prices edge lower.