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Non-independent Research Daily Softs Technical Charts

Non-independent Research

Daily Softs Technical Charts

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NY 2nd Month Sugar Futures

NY sugar futures sold off yesterday as a lack of appetite for higher prices helped to confirm the resistance at 20.38; the market closed at 19.67. Stochastics are falling and diverging on the downside out of the overbought territory, and the RSI has edged lower, suggesting waning buying pressures. The MACD diff is positive and converging, suggesting the outlook for negative prices. The close near the lows suggests the strong selling pressure in the near term, and the indicators point to a softer negative trend. A break below the 19.50 level could set the scene for a test of the support level at 40 DMA at 19.10 before 19.00. Conversely, if current support around 19.50 holds firm, this would help reaffirm the trend on the upside back through 10 DMA at 19.93. If the futures break through this level completely, the prices could test the resistance at 20.38 again in the near term. The downside risks prevail, however the market needs to confirm a break below the support 19.50 for the end of ascending triangle formation and stronger bearish momentum.

Ldn 2nd Month Sugar Futures

Ldn sugar futures buckled yesterday after the candle opened below the previous week’s trading activity. The market closed at 532.20. The stochastics are falling after %K/%D converged on the downside out of the overbought territory, and the MACD diff flipped into negative, which would usually pave the way for lower prices in the near term. On the downside, futures need to break below the support of 531.50 in order to confirm further downside impetus. A break below this level could trigger losses to 40 DMA at 521.59. Alternatively, the reaffirmation of support at 531.50 could set the scene for higher prices back to test 547.90, and a break above this would help fill in the gap created by yesterday’s performance. The indicators point to further downside momentum, but with the gap created yesterday, we would expect the futures to test 547.90 before further downside momentum.

NY 2nd Month Coffee Futures

NY coffee futures softened yesterday as intraday trading caused futures to close at 221.70. The stochastics have softened, with %K/%D diverging on the downside, and the MACD diff converged on the downside, a strong sell signal. The rejection of prices above 40 DMA at 226.74 and a break below 221 would suggest an appetite for lower prices to 212.60. Alternatively, if prices were to break back above 40 DMA, this could trigger a test of 10 DMA at 228.10 and then 100 DMA at 233.80. To confirm another bearish candle, futures need to take out 221. A break below this level would confirm the outlook for lower prices.

Ldn 2nd Month Coffee Futures

Ldn coffee futures softened yesterday after testing the support level of 2078. The market closed higher at 2088. The RSI is falling, and %K/%D are about to converge on the downside, and the MACD diff is negative. On the downside, futures need to break below the support of 2078 in order to confirm the bearish trend to 2019. Alternatively, the appetite back above 2104 could set the scene for higher prices back to test the 40 DMA at 2121, confirming the hammer formation. Indeed, the 2078 support level has been robust in the last couple of weeks, but a recent break below this level would suggest strong conviction on the downside in the near term.

NY 2nd Month Cocoa Futures

NY cocoa futures weakened yesterday after finding support above the trend line once again. The market closed at 2580. The stochastics are falling, and the MACD diff is negative and diverging, suggesting we could see lower prices in the near term through the support of 200 DMA at 2574. A break below this level would bring into play the 50% fib level at 2553, which could set the scene for trend support at 2547. On the upside, futures need to gain back above 2622 – the previous day’s high - in order to confirm upside momentum. Appetite for prices above this level could trigger gains towards the level at 2667; this could strengthen the trend in the long run on the upside. The hammer formation and a test of robust trend support point to a rejection of prices below this level, and we would expect to see the futures follow the ascending triangle formation in the near term.

Ldn 2nd Month Cocoa Futures

Ldn cocoa gapped lower yesterday as selling pressure triggered a close on the back foot at 1768. The stochastics are falling, with %K/%D diverging on the downside. The MACD diff is positive and converging. A long bullish candle body with a long upper wick suggests growing selling pressures; this could set the scene for lower prices to break below the trend support at 1767, but prices struggled below that level in the last couple of months. Reconfirmation of support at that level would confirm the trend for rising prices, up to 1800, which would help fill the gap created yesterday. This could also trigger gains back towards 1813. Indicators point to lower prices, but the key support is to be broken to confirm this sentiment. We expect prices to struggle below this level in the near term.

Contents

Disclaimer

This is a marketing communication. The information in this report is provided solely for informational purposes and should not be regarded as a recommendation to buy, sell or otherwise deal in any particular investment. Please be aware that, where any views have been expressed in this report, the author of this report may have had many, varied views over the past 12 months, including contrary views.

A large number of views are being generated at all times and these may change quickly. Any valuations or underlying assumptions made are solely based upon the author’s market knowledge and experience.

Please contact the author should you require a copy of any previous reports for comparative purposes. Furthermore, the information in this report has not been prepared in accordance with legal requirements designed to promote the independence of investment research. All information in this report is obtained from sources believed to be reliable and we make no representation as to its completeness or accuracy.

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