NY 2nd Month Sugar Futures
NY sugar futures softened yesterday after prices failed above the 18.60 level, prompting a close on the back foot at 18.51. The stochastics are falling further into the oversold territory, and the MACD diff is also diverging on the downside, outlining the weakness in the market. Selling pressure has been strong; yesterday's close below the key support levels suggests an increased appetite for lower prices. A break of 18.50 could set the scene for lower prices to 18.00 – a robust support level. Alternatively, if prices can gain a footing back above 19.00, the bulls could then target shorter-term DMAs in order to regain upside conviction. We anticipate prices will remain on the back foot in the near term.
Ldn 2nd Month Sugar Futures
Prices weakened yesterday as continued selling pressure triggered a close at 513. The stochastics are falling; the %K/%D is diverging on the downside in the oversold, but the momentum is slowing, signalling a weakening bearish trend. The MACD diff is negative and remained flat yesterday. Prices tested 512.60; however, a close above and an open above this level today support market indecisiveness below that level. On the upside, a break above 10 and 40 DMA at 537.21 and 544.40, respectively, could see the test of the 550 level. Conversely, a break below the 512.60 support line could set the scene for a test of 500. We expect prices to remain supported above the 512 level today.
NY 2nd Month Coffee Futures
Prices weakened marginally yesterday as selling pressure triggered a close at 237.50. The MACD diff is negative and diverging. The stochastics are about to fall into the oversold territory. The inside day yesterday suggests a continuation of the recent trend of sideways pressures. Dips in the market have not been well bid, and the current support at 233.35 could point to a lack of appetite for downside momentum. Conversely, a break above 240 could trigger gains to 10 DMA at 241.54. The indicators point to further downside momentum, but candles need to break below the near-term support to confirm this.
Ldn 2nd Month Coffee Futures
Ldn coffee futures edged lower yesterday as prices failed above the previous day’s closing price and then closed below the 4500 level at 4452. The indicators favour the downside; the stochastics are falling, with %K/%D diverging on the downside and edging away from the overbought area. The MACD diff is negative and diverging on the downside, confirming further selling pressures. A break below the 4400 would bring into play the support at 4338. On the upside, prices need to find support above 10 DMA at 4544 before targeting 4600 in the near term. Indicators point to further bearish momentum. We expect prices to weaken in the near term.
NY 2nd Month Cocoa Futures
NY cocoa futures opened higher yesterday, but resistance of 7500 caused futures to close at 7290. The stochastics are converging on the upside, and the MACD diff is negative and converging, suggesting waning selling pressures. A break of the 7500 level could trigger gains through 10 DMA at 7675, with the tertiary level at 8000. On the downside, a break below the 7000 could set the scene for bearish momentum towards 100 DMA at 6389. A thin candle body has been formed, which points to market indecisiveness about higher prices; however, the indicators point to growing upside momentum in the near term.
Ldn 2nd Month Cocoa Futures
Ldn cocoa held the nerve yesterday as intraday trading caused futures to close at 5744. The %K/%D is converging on the upside out of the oversold area, confirming the change of trend in the near term. The MACD is negative and converging, confirming growing buying pressure. To maintain positive momentum, prices need to close above 5800 and then target the 6000 level. On the downside, the rejection of prices above 6000 could trigger losses back to the 100 DMA level at 5332 before targeting 5000. Buying pressure has been weak, but the indicators point to an acceleration of that momentum. The doji candle confirms market uncertainty. The break above could confirm the outlook for lower prices in the near term.
