NY 2nd Month Sugar Futures
NY sugar futures held their nerve yesterday as intraday trading saw prices close at 18.93. The RSI is beginning to rise; meanwhile %K and %D are falling towards the oversold. The MACD diff is negative and diverging marginally, suggesting some appetite for lower prices, but futures need to break below the 18.83 level. A break below this level towards 100 DMA at 18.67 would confirm the continued bearish momentum. Conversely, an appetite for prices above the 40 DMA at 19.28 could trigger a test of resistance of 19.50. The candle struggled to break below the near term support, but the gravestone doji candle is usually a signal of downside momentum. If futures can break below the 18.83, that would confirm the indicators in the near term.
Ldn 2nd Month Sugar Futures
Ldn sugar futures weakened marginally yesterday after testing the support level of 512.90. The market closed higher at 513.30. The stochastics are falling, with %K/%D diverging on the downside, in the oversold. Likewise, the MACD diff is negative and diverging, pointing to continued downside pressure in the near term. To confirm this, futures need to break below the support of 512.90, down to 100 DMA at 504.89. On the upside, an appetite for prices back above 520 could set the scene for higher prices back to breach the 40 DMA level at 526.56 up to 530.20, confirming an inverse hammer formation. The indicators confirm continued selling pressures, and a break of near term support would suggest a growing downside conviction in the near term.
NY 2nd Month Coffee Futures
NY coffee futures edged lower yesterday as moderate selling pressure triggered a close at 221.15. The stochastics are falling, with the %K in the oversold territory; however, the MACD diff is negative and diverging. A break of the 221 could trigger losses through trend support at 218.35, with the tertiary level at 212.60. On the upside, a break above previous sessions’ highs and 40 and 10 DMA at 224 could set the scene for a test of 227.95, pointing to a change of trend for more bullish momentum. Yesterday’s bearish spinning top formation points to market indecisiveness about the outlook for higher prices, and the futures have found both robust support and resistance levels that are converging. The indicators are suggesting further downside momentum, but with a lack of a strong signal, we expect the futures to continue to trade range-bound.
Ldn 2nd Month Coffee Futures
Ldn coffee futures softened yesterday after finding support above 2048. The market closed at 2054. The stochastics are seen diverging on the downside, and the MACD diff is negative and diverging, suggesting we could see lower prices in the near term through the support of 2019. A break below this level would bring into play the robust support level at 2000, which could set the scene for trend support at 1952. On the upside, futures need to gain back above 2078 and then the previous day’s high at 2104 in order to confirm upside momentum. The reaffirmation of support here could trigger gains towards the levels at 10 and 40 DMAs at 2096 and 2105, respectively; this could strengthen the trend in the long run on the upside. The robust resistance levels and the indicators point to further downside momentum in the near term.
NY 2nd Month Cocoa Futures
NY cocoa futures held their nerve yesterday as intraday trading saw prices close at 2507. The RSI is rising, and %K/%D is oversold. The MACD diff is negative and diverging, but the momentum is slowing, suggesting a waning appetite for lower prices, but futures need to break above the trend level at 2560 to trigger the momentum. A break above this level towards 200 and 10 DMA levels, both at 2579, would confirm the strong bullish momentum. Conversely, an appetite for prices below the 61.8% fib level at 2485 could trigger a test of support of 2436. A long-legged doji candle shows indecision about either direction as it traded within Tuesday’s range. The indicators point to waning selling momentum, but futures need to close above the trend resistance to confirm this.
Ldn 2nd Month Cocoa Futures
Ldn cocoa futures gained ground yesterday as protracted buying pressure prompted a test of the 1775 level to close on the front foot at 1771. The stochastics are falling, yet %K is seen tailing off on the upside, highlighting waning selling pressures. The MACD diff is negative and converging. To confirm another bullish candle, futures need to close above the trend line at 1783 and then target 1800. On the downside, a complete break below 100 DMA at 1752 could set the scene for lower prices towards the support of the 50% fib level at 1730. However, the market struggled below the 100 DMA level in recent sessions, and the bullish engulfing pattern suggests a strong buy signal. We believe that prices will strengthen in the near term.