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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 weakened yesterday as protracted selling pressure triggered a close at 18.25; the 10 DMA support held firm. The stochastics have converged on the downside in the overbought, a strong sell signal, and the MACD is positive and converging. On the downside, the support at 10 DMA at 18.22 must be taken out first to confirm further downside momentum to 18.00 and 17.48 in the longer term. On the upside, the 40 DMA resistance at 18.38 has to be broken above completely to suggest upside momentum to 18.60 and 18.83. The longer candle body yesterday and strong conviction from the indicators suggest that selling pressure is growing and should help the futures to set the scene for lower prices below 10 DMA. 

Ldn 2nd Month Sugar Futures

Ldn sugar futures weakened yesterday as the prices struggled above the previous day’s resistance at 534.20. The futures closed at 524.50. The stochastics have converged on the downside, and the MACD diff is positive and converging, strong selling pressure, and we could see strong downside momentum in the near term. To confirm this, the futures need to break below the 40 and 10 DMA levels at 521, respectively, before retesting the 512.90 level. On the upside, if the support at the DMA levels holds, this could cause the futures to test the 530 level once again before 540. Yesterday's protracted candle and the indicators confirm this outlook on the downside in the near term.

NY 2nd Month Coffee Futures

NY coffee futures edged lower yesterday, but support at 40 DMA caused the market to close above at 216.30. The stochastics have converged on the downside and now falling, with %K/%D edging out of the overbought territory, and the MACD diff is negative and converging, suggesting lower prices in the near term. To confirm this, futures need to close back below the 40 DMA at 215.68 before testing the support at 212.60 and 209.65. However, a break above the robust resistance level at 100 DMA at 220.56 could trigger gains back to the trend resistance at 228 and 230. The long candle body with little upper and lower wick shows the conviction for downside momentum; however, near-term support levels at the moving average have to be broken first to confirm the outlook.

Ldn 2nd Month Coffee Futures

Lnd coffee futures lost ground yesterday after prices failed above the 2280 level, prompting a close at 2228. The stochastics are showing signs of weakness, with %K/%D converging on the downside in the overbought territory, and the MACD diff is positive and converges as the appetite for higher prices exhausted itself. Futures need to close above 2281 resistance and then target 2300 in the near term to suggest further upside momentum. On the downside, the long candle suggests an increased appetite for lower prices in the near term. Prices need to close below 2200 before targeting 10 DMA at 2162. The bearish engulfing pattern suggests an impeding market downturn, and we expect prices to continue to fall in the near term.

NY 2nd Month Cocoa Futures

NY cocoa futures edged lower yesterday after prices broke below the 10 and 40 DMA support levels, prompting a close at 2370. The stochastics are falling, with %K/%D converging on the downside, and the MACD diff is positive and converging, confirming the sell signal. To confirm the bearish indicators and rejection of prices above the trend resistance, futures need to take out support at 40 DMA at 2377 completely and then target 2333. On the upside, futures need to close above 10 DMA at 2390 and then test 2420 in order to confirm the outlook of higher prices towards 2500. We expect futures to weaken in the near term.

Ldn 2nd Month Cocoa Futures

Ldn cocoa sold off yesterday after investors rejected prices above 1800, prompting a close below at 1782. The stochastics are falling, with %K/%D converging on the downside out of the overbought, suggesting growing downside momentum. The MACD is positive and converging. To confirm another bearish candle and create a three black crows’ formation, prices need to break below the support levels of 50 and 200 DMAs at 1758 and 1750, respectively, before they can target the trend support level at 1730. On the upside, to regain upside conviction, futures need to close back above 1800 and then 1830 in the near term. Near-term momentum is on the downside, and the close below the shorter-term DMA would confirm this trend.

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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.

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