Sugar futures extended their gains only slightly today but one bank warns of heavy fund activity making sugar vulnerable to a sell-off. Sugar futures are up 5 points today currently trading at .1966 per pound at the New York Intercontinental Exchange.
Even with increasing expectations for next season’s sugar deficit, a prominent Dutch-bank feels strongly the sugar market sentiment has been exaggerated much ahead of the fundamental situation. Any shift in production at this point – the bank points out – could encourage a “rush for the exit” in this heavily top-heavy market.
Laura Taylor, a senior market strategist at RJO Futures in Chicago, shared her fundamental view of the sugar futures market by stating, “The fundamental situation reportedly supports higher sugar (futures) prices, but with no significant pull-back after a nickel rise I can understand the bank’s statements.” Taylor adds, “The .20c psychological price is fast approaching and if sugar futures were to sell-off, this may be the turning point price.”
The technical trend for sugar futures is up with no top yet in sight. Sugar futures have accelerated almost two-cents ahead of it 18-day moving average, so we can easily see a pull-back to the mid-.17c level (in my study).
ALL COMMENTARY IS CONSIDERED OPINION & VIEWS FROM THE AUTHOR AND NOT A SOLICITATION OF ANY SECURITIES. THE RISK OF LOSS IN TRADING COMMODITY INTERESTS CAN BE SUBSTANTIAL. YOU SHOULD THEREFORE CONSIDER WHETHER SUCH TRADING IS SUITABLE FOR YOU IN LIGHT OF YOUR FINANCIAL CONDITION.