Below is a sample of our Daily Commentary. To get this comment, and our daily coverage of 15 additional markets and trade ideas, visit futures-research.com for your free 2 week trial!
The market remains in a steep downtrend and with bearish technical action yesterday and new lows overnight, the long liquidation selling trend continues. Keep in mind; the combined non-commercial and non-reportable (spec) net long position as of March 9th was still 156,406 contracts so new lows will still attract new long liquidation selling. May sugar closed sharply lower yesterday as the market continued its long liquidation trend from last week as well as exiting its recent consolidation range. Prices have now reached their lowest levels since last July, as expectations of a massive Brazil cane crop along with the easing of the world’s sugar deficit have kept longs under pressure. With a weak dollar, strong gold prices and another bounce in energy prices, the outside market forces are positive but the spec liquidation trend appears to be the dominate force today. An announcement during the session that Pepsi plans to stop sales of full-sugar beverages to schools only added to the market’s negative tone and there are revived efforts by states and even cities to tax sugar beverages. Physical buyers have been reluctant to make purchases recently, in anticipation of even lower prices during the near future. London nearby white futures fell 3.7% yesterday. Australia sugar production for the coming season is expected to be up 7-8% from last year with much better weather expected to push cane production higher.
TODAY’S GUIDANCE: While there appears to be plenty of potential buyers, the new buyers are still waiting to see some stability or a sign of a low before extending coverage. Speculative liquidation remains the dominate force. Support for May sugar is at 19.38 and then 18.43. A move through 20.19 may be enough to spark some short-covering and start a recovery bounce with 22.04 as initial objective and we would not rule out a strong recovery to 22.70.
TODAY’S MARKET IDEAS: The next support for May sugar comes in at the 17.45-17.10 zone with 19.65 as trendline resistance. It will take a move back through resistance to expect a low.
Sugar Market Commentary – 2010.03.17
by Terry Roggensack on March 17, 2010
Below is a sample of our Daily Commentary. To get this comment, and our daily coverage of 15 additional markets and trade ideas, visit futures-research.com for your free 2 week trial!
The market remains in a steep downtrend and with bearish technical action yesterday and new lows overnight, the long liquidation selling trend continues. Keep in mind; the combined non-commercial and non-reportable (spec) net long position as of March 9th was still 156,406 contracts so new lows will still attract new long liquidation selling. May sugar closed sharply lower yesterday as the market continued its long liquidation trend from last week as well as exiting its recent consolidation range. Prices have now reached their lowest levels since last July, as expectations of a massive Brazil cane crop along with the easing of the world’s sugar deficit have kept longs under pressure. With a weak dollar, strong gold prices and another bounce in energy prices, the outside market forces are positive but the spec liquidation trend appears to be the dominate force today. An announcement during the session that Pepsi plans to stop sales of full-sugar beverages to schools only added to the market’s negative tone and there are revived efforts by states and even cities to tax sugar beverages. Physical buyers have been reluctant to make purchases recently, in anticipation of even lower prices during the near future. London nearby white futures fell 3.7% yesterday. Australia sugar production for the coming season is expected to be up 7-8% from last year with much better weather expected to push cane production higher.
TODAY’S GUIDANCE: While there appears to be plenty of potential buyers, the new buyers are still waiting to see some stability or a sign of a low before extending coverage. Speculative liquidation remains the dominate force. Support for May sugar is at 19.38 and then 18.43. A move through 20.19 may be enough to spark some short-covering and start a recovery bounce with 22.04 as initial objective and we would not rule out a strong recovery to 22.70.
TODAY’S MARKET IDEAS: The next support for May sugar comes in at the 17.45-17.10 zone with 19.65 as trendline resistance. It will take a move back through resistance to expect a low.
Tags: Softs, Sugar
About Terry Roggensack