RJO FuturesCast

Daily Futures Market News, Commentary, & Insight

Sideways… Shoot… May sugar futures contract is still only sideways… Every time I think I’m going to wake up to a clearly defined trend, still only sideways.  Each time I look around, the bands move in a little tighter. Oftentimes, when faced with sideways market action or the fatigue that comes with attempting to maintain a bias in the face of a non-trending market, a trader has two choices. Offset the position or revisit the fundamentals, well known though they may be, and attempt to gird oneself against the waves of monotony washing over the trade. In the last two weeks, the sugar market has attempted to break out to both the upside and the downside. Both breakouts failed and here we find the May sugar futures contract right where it was when we started 2017.  Asian demand, in my opinion, is the fundamental that will reign supreme.  The potential for weather related production challenges looms. The idea that South American sugar will arrive on the market without any disruption or the potential for disruption seems optimistic.  With the lowest stocks in 7 years there would appear to be very little room for any global production shortfall.  This, combined with hot money pacing the sidelines waiting for a fundamental story they can turn into a massive technical move makes me believe that the path of least resistance is higher. 

 

Sugar Daily Chart

Joe Nikruto

Joe Nikruto attended Indiana State University and DePaul University in Chicago with a major concentration in economics. "It was during college that I got a job as a runner at the Chicago Board of Trade. I was immediately hooked," he says.He adds that he also enjoys futures trading because anyone can do it. "Your success depends on how you handle the risk and how much work you are willing to put in. You don't need a big-time Wall Street connection, or a degree from an Ivy League school to get started. Your success largely depends on you and what you put into it." In 1992, he started as a runner and back office clerk for a very large futures commission merchant (FCM). He moved up to pit clerk, then research associate working on the trading floors directly for a grain and livestock concern based in Memphis. He spent time on various trading desks for a large retail FCM and then became Series 3 registered in 1997. He also helped develop an online trading platform and consulted on development and trading of mechanical trading systems. He has always worked to assist his clients with all types of trading-from option strategies and hedging to complicated mechanical trading systems. His advisory background includes Floyd Upperman, McMaster, Walter Bressert, Ken Roberts, Tech Guru, Hightower, Helms and Barry Rosen. As for his involvement with RJO, Nikruto says, "R.J. O'Brien has been in operation for more than 100 years. That is a century of supporting customers. You have to be doing something right for folks who use futures to choose to do business with you for that long."