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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 edged lower as prices struggled above 18.00 and closed on the back foot at 17.84. The stochastics are falling, but %K/%D is seen converging on the upside near the oversold. The MACD diff flipped back into the positive territory after crossing into the negative yesterday, suggesting that yesterday’s softness could be short-lasting. On the upside, a break of robust resistance at 18.00 may prompt futures to test the 10 DMA at 18.16. A subsequent breach of this level would prompt prices to regain upside momentum in the near term. Alternatively, the rejection of higher prices may prompt a break back towards support at 17.62; a subsequent breach of this level could trigger losses towards 17.48. A shorter candle body with a longer lower wick points to a weak appetite on the upside, and to confirm this trend, the futures need to break above the 18.00 level in the near term.

Ldn 2nd Month Sugar Futures

Ldn sugar futures edged marginally higher yesterday as they closed at 517. The RSI is rising, and stochastics are showing signs of convergence on the upside, with %K seen tailing off. The MACD diff is positive and converging, but the momentum is slowing, suggesting slowing selling pressure. The indicators point to slowing downside momentum, and to confirm the rejection of the resistance, prices need to take out 40 DMA at 520.44. A break above this level towards 10 DMA at 522.80 would confirm the growing upside momentum. Conversely, an appetite for prices below the 512.90 level could trigger a test of 500. A bullish candle with a small candle body after a spinning top formation suggests a lack of appetite for a change of momentum, and the futures need to break back above the near-term resistance to confirm the continuation of upside momentum.

NY 2nd Month Coffee Futures

NY coffee futures rallied yesterday as protracted buying pressure triggered a close on the front foot at 228.25. The RSI is rising, while %K/%D is rising and diverging in the overbought. The MACD diff is positive and diverging. On the upside, a complete break above 227– the trend resistance - could trigger gains through 230 towards 240. On the downside, a break below the support level of 100 DMA at 220.51 could trigger losses back towards 10 and 40 DMAs at 215 and then support at 212.60 to confirm the outlook of lower prices in the longer term. We believe that prices will continue to strengthen today before the rally runs out of steam, as indicators are now overbought.

Ldn 2nd Month Coffee Futures

Ldn coffee strengthened marginally yesterday, as protracted buying pressure triggered a close on the front foot at 2258. The stochastics are rising, with %K/%D diverging on the upside in the overbought. The MACD diff, however, is positive and converging, suggesting that the recent bull run has been exhausted. A narrow bullish candle body with a long lower wick, however, suggests growing buying pressures; this could set the scene for higher prices to break above the 2281 resistance. This would confirm the trend for rising prices, up to 2300. On the downside, a breach of support at 10 DMA at 2242 would strengthen the bearish momentum. This could also trigger losses towards 2200. Indicators point to a mixed outlook, however, futures need to break above 2281 to confirm the outlook on the upside.

NY 2nd Month Cocoa Futures

NY cocoa futures softened yesterday after breaking below the support of 2333. The market closed at 2318. The stochastics are falling towards the oversold territory, and the MACD diff is negative and diverging, suggesting we could see lower prices in the near term through the support of 2300. A break below this level would bring into play the 2236 level, which could set the scene for support at 2200. On the upside, futures need to gain back above the 40 DMA level at 2369 in order to confirm upside momentum. The appetite for higher prices here could trigger gains towards the 10 DMA level at 2395; this could strengthen the trend in the long run on the upside. The longer upper wick points to an increased appetite on the downside, and we could see the price edge lower in the near term.

Ldn 2nd Month Cocoa Futures

Lnd cocoa futures sold off yesterday as protracted selling pressure prompted a break of support at 1800 to close on the back foot at 1787. The stochastics are falling out of the overbought, and the MACD diff just converged on the downside, a strong sell signal suggesting lower prices in the near term. The break of the key support levels at 100 and 50 DMA at 1771 and 1764, respectively, would suggest an appetite for lower prices. If prices find support at 100 DMA, this could prompt a recovery back above the 1800 level. In the medium term, we could see futures break above 1833. This level has provided strong resistance in recent weeks, and a close above this level would prompt prices to regain upside conviction. We anticipate prices to retreat 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.

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