Sugar Trading SidewaysPosted 04/25/2019 9:19AM CT |
This week’s comment finds sugar trading sideways, trapped within a range bounded by 13.00 to the upside and roughly 12.20 to the downside. July sugar has tried to breakout, both to the downside and to the upside, yet here we sit at 12.90, again. On Wednesday morning, Hightower spoke of two fundamentals that caught me by surprise. Chinese imports way down. According to the widely read commentator, Chinese cumulative imports for 2019 were down over 50% vs the same time in 2018. Additionally, in Brazil, a record low amount of sugar cane used for sugar vs used for ethanol, 36.45%, according to Hightower. Less sugar demanded by a top five global importer. Less sugar produced by the world’s largest producer. These two fundamental factors may point to exactly what we see on the chart. July sugar is trading in a range and will likely do so until something changes fundamentally. Intermediate- term trend followers look to get long above 13.30 and short below 12.30. At this point, it is difficult to see the catalyst for a sustained move in either direction.
Sugar Jul ’19 Daily Chart
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