NY 2nd Month Sugar Futures
NY sugar futures opened lower but managed to close higher day-on-day at 19.85. The stochastics are converging on the downside, with %K%D now falling, sending a strong sell signal. The MACD diff also just converged on the downside, amplifying the growing selling pressures. On the upside, futures need to break above the resistance levels of 10 DMA at 19.99 and 20.00 to trigger the momentum. Prices would then need to take out the 40 DMA at the 20.30 level to confirm the longer-term outlook. Conversely, appetite for prices below 19.50 could trigger a test of support of 19.21. A dragonfly doji candle shows rejection of higher prices and confirms the indicators that point to an end in bullish sentiment. Prices should continue to weaken in the near term.
Ldn 2nd Month Sugar Futures
Ldn sugar futures held their nerve yesterday, causing the market to close at 548.30. The stochastics are falling, with %K/%D diverging on the downside, and the MACD diff is negative and diverging, suggesting lower prices in the near term. To confirm the outlook for lower prices, futures need to close back below 540.20 and then target 530. The 10 DMA is closing in and resisting prices from the upside. However, a break above that level could set the scene back for the trend channel at 555. A subsequent break above this level could prompt a test of 40 DMA at 563.92. The narrow candle body with longer lower wicks points to more appetite on the upside, but the futures need to break out of current resistance to confirm the near-term outlook.
NY 2nd Month Coffee Futures
NY coffee futures gained ground yesterday as buying pressure triggered a close on the front foot above the trend resistance at 313. The stochastics are rising with the %K/%D converging on the upside, as the MACD diff is positive and diverging, outlining growing buying pressures. This suggests we could see higher prices in the near term towards the recent highs at 330, but the market needs to take out immediate resistance of 320. On the downside, the candle found support at 10 DMA at 306.13, and if the prices break through this level, we could see futures retreat back through 300. The recent candles formed a three-white soldier formation, and with a break above the 300-level signals, we could see further bullish momentum in the near term.
Ldn 2nd Month Coffee Futures
Ldn coffee strengthened yesterday as buying pressure triggered a close on the front foot at 4873. The stochastics are falling yet converging, with %K/%D beginning to tail off on the upside. The MACD diff is negative. A longer bullish candle body with short wicks suggests growing buying pressures; this could set the scene for higher prices to break above the resistance at 5000. This would confirm the trend for rising prices up to the 10 DMA at 5064. On the downside, a breach of support at 4664 would strengthen the bearish momentum. This could also trigger losses towards the 4500. Indicators point to higher prices, and we expect further strength in the near term.
NY 2nd Month Cocoa Futures
NY cocoa futures rallied yesterday as protracted buying pressure triggered a close on the front foot at 9853. The %K/%D is diverging on the upside in the overbought. The MACD diff is positive and diverging, outlining recent market growth. On the downside, a break back below the support level of 9540 could trigger losses back towards the 10 DMA at 9212; a break below the 9000 would confirm the outlook for lower prices in the longer term. On the upside, a break above the robust resistance at 10000 could trigger further gains towards 10200 – June highs. The market rally has been strong, and we could see prices trend even higher today, but resistance at 10000 needs to be taken out for this to be the case.
Ldn 2nd Month Cocoa Futures
Ldn cocoa futures strengthened marginally yesterday, but resistance at 8000 triggered a close below it at 7854. The %K/%D diverging on the upside in the overbought. Likewise, the MACD diff is positive and diverging, suggesting further upside in the near term. To confirm this, prices need to take out the key 8000 level. On the downside, a break below the 10 DMA level at 7584 could trigger losses back towards the 7348 level. That level has been supporting futures prices in recent days, and a break below it would signal strong selling pressure. A longer upper wick signals that the market is struggling above the 8000 level. Hence, this level must be broken first to confirm the outlook.
