Sugar futures are attempting to recover from recent lows during Thursday’s trading session. October’s contract made new lows this week due to Brazil’s supply situation and reaching oversold technical levels. Sugar was unable to find support until 10.37 was touched, consolidation has led to a breakout and possible reversal. The focus had turned to India’s crop, monsoons and the sell-off in energy prices. Ethanol prices in Brazil also hit 10-month lows. Currency prices added to the pressure in sugar earlier this week. The market has now shifted its focus to bullish supply news in the top-producing areas of the world. With short specs way below record levels, traders will monitor COT reports and watch for addition short-covering heading into the weekend. To reaffirm a potential reversal, a close and hold above 10.85 will be needed.

Sugar Oct ’18 Daily Chart

Sugar Oct '18 Daily Chart

Peter Mooses

Follow Peter on Twitter @PMoosesRJO. Peter's interest in trading began during a college internship with Bunge North America on the floor of the Chicago Board of Trade, where he assisted commodities traders and performed market research and analysis. Upon earning a B.A. in economics from the University of Iowa, Peter served as an analyst, transaction manager and team lead in the Global Trust Divisions for LaSalle Bank and Bank of America, where he managed transaction activity in multi-million dollar client fixed income and asset-backed securities portfolios. After years in the banking industry, it became apparent that Peter's real passion lies in futures trading. He joined RJO Futures because he enjoys the analytical aspects of futures trading and appreciates the economic impact that commodities have across all markets. Peter believes in utilizing market analysis and trends to help clients achieve balance between risk and return, while always keeping their investment objectives top of mind.