• Friday evening brought the news that the fund net long position had risen to 111,584 lots as at last Tuesday’s close, largely in line with broad expectations, with the live position maybe showing a slight reduction given the slip at the end of last week. Early trading was sharply lower, however sugar fundamentals were being ignored as for the moment it is the Coronavirus that is impacting upon the macro as a whole. This sent us down to 14.10 in early trading and in truth the market struggled to properly recover, a couple of defensive pushes from specs during the afternoon failing to generate any follow on buying, instead leaving us to consolidate within the mornings range. Having removed the immediate strength from the market one would expect an extended period of consolidation, which at the very least will allow technical indicators to properly unwind their overbought status. The coronavirus will likely dominate for some while as the extent of its spread becomes known, and in such an environment many will naturally take a low risk strategy.

undefined

Jon Whybrow

Jon joined CZ in 1991, working in the Treasury department before moving to join the derivatives team in 1994. Over 30 years Jon has built up significant experience across derivatives markets and products, particularly sugar, and is now Head of Flow derivatives providing market execution services for CZ’s global client base. He is responsible for the market commentaries which are published each day on CZ app.

More from this author