NY 2nd Month Sugar Futures
NY sugar futures sold off yesterday after investors rejected prices above the DMA levels, prompting a close below at 18.53. The stochastics are falling, with RSIs in neutral territory; the %K/%D are diverging out of the overbought, suggesting a negative trend. The MACD diff just converged on the downside, sending a strong sell signal, indicating improving sentiment on the downside. To confirm another bearish candle and form the three black crows formation, prices need to break below the support level at 18.44 before the 18.17 level. Conversely, to regain upside conviction, futures need to close back above 40 DMA at 18.95 and then 10 DMA at 19.01 in the near term. Near-term momentum is on the downside, the close below all of the DMA levels confirms this trend.
Ldn 2nd Month Sugar Futures
Prices weakened yesterday as moderate selling pressure triggered a close below the 512.90 support level; the market closed at 512. The stochastics are falling, with %K/%D now In the oversold territory. The MACD diff is negative and diverging, and the candle with a long body supports market conviction on the downside. Volumes, however, have shrunk significantly in the last couple of days, so in order to confirm the continuation of the trend, prices need to break below the current support of 510 and then 500. Conversely, a break above the 520 resistance line could set the scene for a test of 100 DMA at 530. We expect prices to decline in the near term; however, with stochastics now oversold, the momentum is likely to slow.
NY 2nd Month Coffee Futures
NY coffee futures edged lower yesterday, but support at 10 DMA caused the market to close at 211.75. The stochastics are rising, but %K/%D is showing signs of convergence, and the MACD diff is negative and remained flat day-on-day, suggesting upside momentum is weakening. To suggest the outlook of higher prices, futures need to close back above 212.60 and then target 100 and 40 DMAs at 223 before 230. However, a break below support at 10 DMA at 208.77 could set the scene for 202.30 and then 200. The narrow candle body with short upper and lower wicks points to a lack of appetite in either direction yesterday, and the futures need to break out of current resistance/support to confirm the near-term outlook.
Ldn 2nd Month Coffee Futures
Ldn coffee weakened yesterday as moderate selling pressure triggered a close at 1987. The MACD diff is positive and converging. The stochastics are rising, and now the %K has tailed off on the downside, suggesting convergence in the near term. However, the inside day yesterday could suggest a lack of appetite for lower prices, and if the support at 10 DMA at 1970 holds, this could point to further upside momentum. On the downside, if the futures do break below this level, we could see a test of 1952 and 1914 once again. Conversely, a rise above the resistance at 2010 has been held in recent weeks, and a break above could trigger further gains to 40 DMA at 2039. The indicators point to softening upside momentum, but candles need to break above the near-term support to confirm this.
NY 2nd Month Cocoa Futures
NY cocoa weakened yesterday as protracted selling pressure triggered a close on the back foot at 2344. The stochastics are converging on the downside, and the RSI has also edged lower, suggesting a sell signal is approaching. The MACD diff is positive and converging. A full bearish candle suggests growing selling pressures; this could set the scene for lower prices to break below the 10 DMA support level at 2345. This would confirm the trend for falling prices, down to 2317. On the upside, resistance at 40 DMA at 2410 has proven to be strong, and an appetite above that level would strengthen the bullish momentum. This could also trigger gains towards 2500 in the longer term. A strong bearish candle and the indicators suggest an impeding market downturn, and we expect prices to continue to fall in the near term.
Ldn 2nd Month Cocoa Futures
Ldn cocoa futures buckled yesterday as protracted selling pressure triggered a close on the back foot at 1759. The stochastics are converging on the downside, and %K/%D is about to give a sell signal,; the RSI is also falling. The MACD diff is positive and converging, confirming growing selling pressure; this could set the scene for lower prices below 50 DMA at 1753, but futures need to break below 100 DMA at 1760. A break below this level would confirm the outlook of lower prices down to 1715. On the upside, a break above the 1800 resistance level and appetite for higher prices could set the scene for 1830. Two-line strike formation points to a continuation of an uptrend, but indicators suggest another decline today. To confirm this, futures need to break below the support at moving averages in the near term.