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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 held their nerve yesterday as intraday trading saw prices close at 19.91. The RSI is falling, and %K/%D is now overbought, but %K is seen tailing off on the downside, a sign that momentum is about to change in the near term. The MACD diff is positive and converging, suggesting a further appetite for lower prices, but futures need to break below the 10 DMA level at 19.63 to trigger the momentum. A break below this level towards the support of 19.50 would confirm the growing bearish momentum. Conversely, an appetite for prices above the 20.00 level could trigger a test of resistance of 20.38. A long-legged doji candle shows indecision about either direction; the length of the wicks also points to increased volatility during the day. The indicators point to a decline in prices in the near term, but futures need to close below 10 DMA to confirm this.

Ldn 2nd Month Sugar Futures

Ldn sugar futures opened lower but managed to close higher day-on-day at 541. The stochastics are rising, but %K is seen tailing off on the downside in the overbought, which could suggest a change of momentum in the near term. The MACD diff is positive and converging, confirming the outlook. On the upside, futures need to break above the robust resistance levels of 547.90 and 558 to trigger the momentum. Prices would then need to take out the 560 level to confirm the longer-term outlook. Conversely, appetite for prices below 530.20, where 10 and 40 DMAs currently are, could trigger a test of support of 520. Candles have been trading range bound in the last couple of sessions, and the 10 DMA crossing above 40 DMA should provide robust support. To confirm the indicators’ outlook on the downside, the futures have to break below these levels first.

NY 2nd Month Coffee Futures

NY coffee futures softened yesterday after testing the support level of 212.60. The market closed higher at 213.95. The stochastics are falling, with %K/%D just diverging on the downside, and the MACD diff is positive and converging. The appetite back above 10 DMA at 218.34 could set the scene for higher prices back to test the 221, confirming the hammer formation. On the downside, futures need to break below the support of 212.60 and then 209.65 in order to confirm the bearish trend and the descending triangle formation. A break below these levels to 200 would confirm the strong downside momentum in the longer term.

Ldn 2nd Month Coffee Futures

Ldn coffee futures edged lower yesterday to close higher day on day at 2043. The stochastics are falling, with %K/%D showing signs of decrease after fluctuating in the neutral territory in recent days, and the MACD diff is negative and diverging, suggesting lower prices in the near term. To confirm the marginally bearish indicators and rejection of prices above 10 DMA, futures need to take out support at 2010 and then target 1952. On the upside, futures need to close above 10 DMA at 2065 and then target 2078 in order to confirm the outlook of higher prices towards 2100. Prices have been capped by trend resistance and support, forming descending triangle formation, and with the indicators marginally bearish, we expect the futures to soften but remain within current constraints until a strong buy/sell signal emerges.

NY 2nd Month Cocoa Futures

NY cocoa futures held their nerve yesterday as intraday trading saw futures test appetite at 10 DMA. This level held firm, and the future closed at 2465. The stochastics are rising, but %K is seen falling, as %K/%D show signs of convergence on the downside. The MACD diff is fluctuating around 0 as it lacks the conviction to point out an outlook. To suggest the outlook for lower prices, the market needs to take out support 2436 and then 2400. On the upside, a break above the resistance at 10 DMA at 2481could set the scene for futures to take out the 2500 level before targeting 2553. A doji candle signals uncertainty about the outlook for prices out of the current range as it trades between 10 DMA and 2436.

Ldn 2nd Month Cocoa Futures

Ldn cocoa futures edged higher yesterday, testing trend resistance once again and closing at 1754. The stochastics are falling, with %K flattening out in the oversold, and the MACD diff is negative but flat, suggesting the end of the downtrend. The reaffirmation of support at 1730 could set the scene for higher prices back to test the 100 and 200 DMA levels at 1763. However, these levels will be hard to breach, and the longer upper wick in recent days suggests a lack of appetite for prices above these levels. On the downside, futures need to break below the support of 1730 before 1700. Indeed, the DMAs are providing robust resistance levels. To break above them, the market needs a strong buy signal in the near term.

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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.

This report is not subject to any prohibition on dealing ahead of the dissemination of investment research. Accordingly, the information may have been acted upon by us for our own purposes and has not been procured for the exclusive benefit of customers. Sucden Financial believes that the information contained within this report is already in the public domain. Private customers should not invest in these products unless they are satisfied that the products are suitable for them and they have sought professional advice. Please read our full risk warnings and disclaimers.

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