NY 2nd Month Sugar Futures
NY sugar futures failed above the previous day’s highs yesterday as intraday trading caused futures to close at 19.59. The stochastics have softened, with %K/%D diverging on the downside, and the MACD diff is positive and about to converge on the downside, suggesting selling pressures are growing. The rejection of prices above 19.76 and a break below 40 and 100 DMAs at 19.42 would suggest an appetite for lower prices. On the upside, if prices were to break back above trend resistance, this could trigger a test of 20.00 and then 20.38. To confirm another bearish candle, futures need to take out support at the DMAs and then robust support at 19.00.
Ldn 2nd Month Sugar Futures
Ldn sugar futures softened marginally yesterday as intraday trading saw futures test appetite at 10 DMA once again. This level held firm, and the future closed at 510.50. The stochastics are falling, with %K/%D diverging on the downside. Likewise, the MACD diff converged on the downside, signalling growing selling pressures. To confirm the outlook for higher prices, futures need to break above the resistance at 10 DMA at 513.51, which could set the scene for futures to take out the 517.60 before 520. On the downside, the market needs to take out support at 510 and then support at 40 DMA at 507.33. The 40 DMA level continues to support the futures on the downside, and with a longer upper wick on Thursday, we could see the bears’ strength grow in the near term.
NY 2nd Month Coffee Futures
NY coffee futures gained ground once again yesterday, breaking above 240 resistance level to close at 245.40. The stochastics continue to rise, despite being deeply overbought, as the MACD diff is positive and diverging on the upside. This suggests that the indicators point to no end to bullish momentum in the near term and if prices break above 244.75 before testing the 250 level. On the downside, the candle found support at 240, and if the prices break through this level, we could see prices retreat back through 10 DMA at 230.08. The bullish candle with a longer upper and lower wicks after a similar bullish candle points to growing uncertainty to break out of the current resistance.
Ldn 2nd Month Coffee Futures
Ldn coffee futures opened below a key support level of 10 DMA but found some strength during the day to close higher at 2228. The RSI is falling, and %K/%D just converged on the downside once again close. Similarly, the MACD diff is converged on the downside, suggesting growing selling pressures. The indicators point to lower prices in the near term, and to confirm the rejection of the support, prices need to take out 10 DMA at 2254. A break below this level to 40 DMA at 2192 would confirm the strong bearish momentum. Conversely, an appetite for prices above the 10 DMA at 2254 level could trigger a test of 2310. A narrow bearish candle with longer lower wick signals uncertainty about the outlook for trend reversal, and a break below the key support would there is more appetite for downside potential.
NY 2nd Month Cocoa Futures
NY cocoa futures sold off yesterday as lack of appetite for prices above 2567. The stochastics are falling, as %K/%D converged on the downside, a strong selling pressure, the MACD diff is starting to weaken, supporting the outlook for lower prices. The close below 200 DMA at 2510 could trigger losses back to 61.8% fib level 2475 support in the near term. On the upside, if prices can take out the 2567 resistance, this would confirm the trend, with the psychological level at 2600. We believe that there is an appetite for lower prices in the near term.
Ldn 2nd Month Cocoa Futures
Ldn cocoa futures held their nerve yesterday, causing the market to close at 1718. The stochastics are falling, with %K/%D diverging on the downside, and the MACD diff is positive and converging, suggesting lower prices in the near term. To confirm the outlook of higher prices, futures need to close back above 1719 and then target 1750. The 200 DMA is closing in and supporting prices on the upside. However, a break above that level could set the scene for 1700 and 1650, the recent lows. The narrow candle body points to a lack of appetite for strong selling pressures, but the indicators point to further selling momentum in the near term.