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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 futures continued to edge higher, trading above the 18.50 level to close Friday’s session at 18.59. The stochastics continue to strengthen in the overbought, and the MACD diff is positive and diverging, highlighting the recent bull run. To confirm the continuation of this momentum, the futures need to test the 18.83 level before 100 DMA at 19.00. On the downside, the support of 40 DMA at 18.41 needs to be broken below once again before attempting to test the 10 DMA at 18.15. The recent strong momentum points to a strong appetite for higher prices, but with the indicators being overbought, we expect this momentum to slow down in the near term. 

Ldn 2nd Month Sugar Futures

Ldn sugar futures gapped slightly higher on Friday, as the prices breached the 100 DMA resistance before closing at 533. The stochastics are overbought but are showing that the upside momentum is stalling, with %K seen tailing off. The MACD is positive and diverging. The volume continues to diminish, suggesting that investors are losing conviction in an uptrend. To confirm the change of momentum in the near term the futures need to break back below 100 DMA at 529 before 40 DMA at 521. This could signal strong momentum down to 500 in the longer term. On the upside, the three white soldier's formation has been formed, which could indicate further upside, with prices edging close to 540 and then 547.90. We expect the upside impetus to stall in the near term as bulls run out of steam. 

NY 2nd Month Coffee Futures

NY coffee futures jumped higher on Friday, breaking above the robust 100 DMA resistance level and closing higher at 222.40. The stochastics are edging higher, with %K now overbought, and the MACD diff is positive and diverging. If support at 100 DMA at 220.6 holds, we would expect to see futures test the trend resistance near 230 before continuing higher in the longer term. If the near support level does not hold, this could signal a trend reversal back to 40 and 10 DMA at 216.21 and 212.52, respectively. The long candle body and the indicators confirm the appetite for higher prices in the near term, and we expect futures to edge higher. 

Ldn 2nd Month Coffee Futures

The recent strong bull run continued on Friday, as the futures jumped above 2250 to close at 2261. Given the magnitude of the momentum, the stochastics continue to grow in the overbought, as the MACD diff is positive and diverging on the upside. To confirm the continuation of this trend, the futures need to break above the 2281 level before testing the 2300 level. Alternatively, a break below the 2200 level could signal the end of the uptrend down to 10 DMA at 2119 and 2100. The next key resistance level is at 2281, the February highs, and if the futures breach this level, we would expect to see further upside momentum in the near term. 

NY 2nd Month Cocoa Futures

NY cocoa futures weakened on Friday as the prices struggled above the previous day’s resistance at 2470. The futures closed at 2394. The stochastics are converging on the downside, and the MACD diff is positive and converging, suggesting that the recent strength is waning, and we could see strong downside momentum in the near term. To confirm this, the futures need to break below the 10 and 40 DMA levels at 2391 and 2378, respectively, before retesting the 2333 level. On the upside, if the support at the DMA levels holds, this could cause the futures to test the 2470 level once again before 2500. Friday’s open being below the previous day’s lows suggests growing downside conviction, and the indicators confirm this outlook in the near term. 

Ldn 2nd Month Cocoa Futures

London futures weakened on Friday as protracted selling pressure caused the futures to close below the 1800 support at 1796. The stochastics are showing signs of convergence, with %K seen declining out of the overbought, and the MACD diff is positive and converging, suggesting waning upside pressures. This could set the scene for lower prices below 50 DMA at 1767, but the futures need to take out the robust support level at 1800 completely first. A break below these levels could confirm that the momentum on the downside is growing. Alternatively, a break back above Friday’s highs at 1813 could test the trend resistance at 1820. The three-line strike formation points to a continuation of an uptrend, but the indicators suggest another decline today. We expect the DMA support levels to hold firm today.



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