Sugar continues to digest within a well-defined range that has governed price action for the past 8-10 weeks. After testing significant support toward the lower end of the trading range at 17.00, prices spiked off support and are trading just shy of 18.00 coming into today’s session. Based off yesterday’s performance, the near-term momentum appears bullish with longer term directional bias still neutral to slightly positive. It will be interesting to see how this massive rally will react to upcoming resistance at 18.03 and 18.12.
If price can surpass these technical resistance pivots, then an argument could be made for continuation of the positive momentum up to the previous 18.43 peak. Trader’s should keep in mind that this market has been a choppy, range-bound market for more than two months now and those looking to trade sugar should keep this in mind when determining a trading strategy. Until price can produce a directional breakout from the current range, traders should avoid being overly confident on determining the next directional move in price.
Sugar 30-minute Bar Chart (e-Signal)