Mar 20’ sugar futures are starting the day strong breaking out above consolidation and through the firm resistance point of about 14.50. From a technical perspective, sugar futures could be considered overbought, but in my opinion, there is a lot of reason to be buying still. The fundamentals in this market are increasingly supportive as the estimates for the global production deficit are expected to increase even more. The Hightower Report noted that managed money fund traders had bought 64,006 contracts in one week which is noteworthy. If the fund traders are buying sugar futures so aggressively I’d consider it a strong hint at where prices may be going. My analysis of this market is still very bullish and if we can see prices close and stay above resistance and outside markets lend some support, 15.00 could be an easy target. I would not be surprised if we see a new record net long in sugar before this is all said and done.
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