Sugar Prices Look Cheap

Sugar Futures—Sugar futures in the May contract finished slightly lower this Wednesday afternoon in New York down 2 points at 15.14 a pound as prices are hovering right near a 2 week high.

I am keeping a very close eye on this market as I’m looking at a bullish position on any type of weakness as I believe the risk/reward is in your favor especially longer-term. Fundamentally speaking prices continue to be undercut by the raging pandemic in Brazil, which may prompt the government to extend lockdowns that crimp fuel demand and encourage Brazil’s sugar mills to divert more cane crushing toward sugar production rather than ethanol production, thus boosting sugar supplies. Brazil reported a record of 4,195 Covid deaths on Tuesday.

In my opinion I believe the Coronavirus will be reduced significantly in Europe and therefore demand will come back to these commodities eventually its just a matter of when as the United States is performing excellent at the current time. Sugar is still trading right at its 100 day moving average but slightly below its 20-day as the trend is mixed to lower so look to be a buyer on any price weakness as I do not believe the 17.50 level will be the high in this commodity come 2021.

At the present time I also have bullish recommendations in coffee, orange juice and cotton as I think the whole sector remains cheap. The chart structure at the current time is starting to improve on a daily basis as we are trading at major support on the monthly chart as I see no reason to be short. 

TREND: MIXED–LOWER

CHART STRUCTURE: IMPROVING

VOLATILITY: AVERAGE

 

 

If you are looking to contact Michael Seery (CTA—COMMODITY TRADING ADVISOR) at 1-630-408-3325 I will be more than happy to help you with your trading or visit www.seeryfutures.com 

 

TWITTER—@seeryfutures 

 

 Email: mseery@seeryfutures.com

There is a substantial risk of loss in futures and futures options. Furthermore, Seery Futures is not responsible for the accuracy of the information contained on linked sites. Trading futures and options is Not appropriate for every investor.