NY 2nd Month Sugar Futures
NY sugar strengthened on Friday as protracted buying pressure triggered a close on the front foot at 19.39. The stochastics are rising, with %K/%D is diverging on the upside in the overbought. The MACD diff is positive and diverging. A long bullish candle body with a longer upper wick suggests growing buying pressures; this could set the scene for higher prices to break above the resistance at 19.50. This would confirm the trend for rising prices, up to the 19.75 level before 20.00, which is also May’s high. On the downside, a breach of support at 40 and 100 DMAs at 1.910 would help confirm the bearish momentum. This could also trigger losses towards the 10 DMA at 18.82. Indicators suggest the futures are overbought, and if prices struggle above current resistance today, prices can be seen lower in the near term.
Ldn 2nd Month Sugar Futures
Ldn sugar futures rallied on Friday as protracted buying pressure triggered a close on the front foot at 559.60. The RSI is rising, while %K/%D is diverging on the upside in the overbought. The MACD diff is positive and diverging, confirming rising buying pressures. On the upside, a close above 560 could trigger gains through 564.50 towards 570.10, the May highs. On the downside, a break below the key support level of 547.90 could trigger losses back towards 10 and 40 DMAs at 540, and a break below would confirm the outlook of lower prices in the longer term. Long candle body points to more certainty in the bullish momentum, and a 10 DMA crossing above the 40 DMA, a golden cross, would confirm the outlook for higher prices.
NY 2nd Month Coffee Futures
NY coffee edged higher on Friday as intraday trading caused futures to test support at 194.95 once again; the market closed higher at 199.80. Stochastics are falling, but %K/%D is seen converging on the upside. The MACD diff is negative and diverging, but momentum is slowing. To maintain another bullish candle, prices need to close above 202.30 and then target 209.65 before 212.53. On the downside, the rejection of prices above 200 could trigger losses back to 190.50 before targeting 180. Buying pressure was weak, but the indicators point to slowing downside momentum. However, an inside bullish candle could point to a continued bearish trend in the near term. We expect prices to be softer before the change of trend in the near term.
Ldn 2nd Month Coffee Futures
Ldn coffee futures held their nerve on Friday after testing the support level of 1914, the lows not seen since last August. The market closed higher at 1923. The stochastics are oversold, with %K/%D just diverging on the downside, whereas the MACD diff is negative and converging. The reaffirmation of support at 1914 could set the scene for higher prices back to test the 10 DMA level at 1959, confirming an inverse hammer formation. This could trigger further gains to 2000 and 2010. On the downside, futures need to break below the near-term support in order to confirm the bearish trend. Indeed, yesterday’s support level has been robust, a break below this level would suggest a strong conviction on the downside to 1900 before 1827. The longer upper wick with a narrow body confirms the support is still intact.
NY 2nd Month Cocoa Futures
NY cocoa futures leapt higher on Friday after prices rejected the long bearish candle we saw on Thursday, which triggered a close back above the 10 DMA at 2356. The RSI is rising, while %K/%D have converged on the upside and now rising, a strong buy signal. Likewise, the MACD diff is negative and converging. On the upside, an appetite above 2400 could trigger gains through 40 DMA at 2420 towards 2500. On the downside, a break below the 2300 level could trigger losses back towards Thursday lows at 2236. A break below it would signal a strong selling pressure in the longer term. A long candle body and a break above 10 DMA signals growing upside momentum, and with the indicators converging on the upside, we expect to see an acceleration of upside momentum in the near term.
Ldn 2nd Month Cocoa Futures
Ldn cocoa futures jumped higher on Friday and managed to close above all of the moving average resistance levels at 1768. The indicators suggest we could see higher prices in the near term. The stochastics have converged on the upside and now rising, and the MACD diff is positive and diverging on the upside, confirming the trend on the upside. The RSI is rising, and we expect futures to edge higher in the near term towards 1800, however, the futures first need to take out the robust level on the upside at 1767. On the downside, if futures fail into 1750 once again, then we could see prices break back below 1715 before the long-term support of 1700. We expect futures to firm in the near term, and if the futures break above the DMAs completely, this could provide a strong signal on the upside.