NY 2nd Month Sugar Futures
NY sugar futures gained ground on Friday as marginal buying pressure triggered a close on the front foot at 19.191. The stochastics are overbought, but %K/%D has just converged on the downside, a sell signal, as the MACD diff is positive and converging on the downside. This suggests we could see lower prices in the near term towards 10 DMA at 18.90, before testing the 100 DMA at 18.64 level. On the upside, last week’s candles found support at 18.84, and if the prices break through this level, we could see prices gain ground back through 19.50 before 20.00. The narrowing candle bodies alongside growing wicks point to uncertainty about the price momentum. To confirm the indicators, futures need to break below 10 DMA in the near term.
Ldn 2nd Month Sugar Futures
Ldn sugar futures edged higher on Friday as prices closed at 520.10. The indicators continue to favour the downside, with %K/%D now diverging out of the overbought and MACD diff is positive and converging on the downside, suggesting growing selling pressures. A break below the 10 DMA at 514.40 would bring into play the recent trend level at 501. In order to indicate an improvement of market sentiment on the upside, futures need to gain a footing above 520 and then target the recent highs of 531.50 in the near term. The hanging man candle formation suggests waning buying pressure, and we saw futures struggle above 520 in the last couple of sessions. The fall below 10 DMA would confirm the change of trend in the near term.
NY 2nd Month Coffee Futures
NY coffee futures weakened on Friday as futures failed into the resistance 10 DMA and closed at 221.95. The stochastics remain oversold, and the %K/%D converged on the downside over again and now falling. The MACD is negative but has remained flat in the last couple of trading sessions, as it struggled to point out an outlook. A break below 220 completely would confirm the outlook for lower prices and the three black crows formation, a clear bearish sentiment. This may pave the way for lower prices to 212.60, with the tertiary level at 209.65. Conversely, the reaffirmation of support above at 220 would suggest higher prices and a close above 10 DMA at 226.343, setting the scene for higher prices towards 230. The recent candle formation and indicator point to further downside momentum in the near term.
Ldn 2nd Month Coffee Futures
Prices held their nerve on Friday as moderate buying pressure triggered a close below the 2100 level; the market closed at 2095. The stochastics are rising, and the MACD is negative and about to converge on the upside. The futures have been trading in a narrow range bound by the support and resistance of 10 DMA and 2100, respectively. In order to confirm the indicators, prices need to break above the current resistance at 2100 to set the scene for a test of 23.6% fib level at 2137. Conversely, support of 10 DMA at 2068 could trigger losses back to the recent lows of 2010 before 2000. We expect prices to continue to trade higher in the near term, but the resistance of 2100 must be broken first.
NY 2nd Month Cocoa Futures
NY cocoa futures sold off on Friday after prices failed above the 40 DMA level, prompting a close on the back foot at 2620. The stochastics are converging on the downside near the overbought territory, and the MACD diff is also converging on the downside, outlining the weakness in the market. Selling pressure has been strong, and Friday’s close on the low suggests lower prices towards the 10 DMA at 2600. This support level has been robust, and if the futures break below this level, this could set the scene for a test of 100 DMA at 2547. Alternatively, if prices can gain a footing above 2700, the bulls could then target 2726 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 opened on the front foot on Friday, but the resistance of 1800 caused futures to close below at 1788. RSI is rising marginally, and %K/%D is diverging on the upside in the overbought area. The MACD diff is positive and diverging on the upside, but that momentum is slowing, which could point to waning buying pressures. To maintain positive momentum, prices need to close above 1800 and then target the 76.4% fib level at 1813. On the downside, the rejection of prices above 1800 could trigger losses back to the 50 DMA level at 1760 before targeting 100 and 200 DMAs at 1734 and 1730, respectively. The recent trend has been on the upside, but the indicator point to a slowdown of that momentum.
