• There was immediate buying for the market this morning as traders built upon yesterday’s momentum to immediately drive above 15c , with some 5,200 lots of March’20 traded during the first 5 minutes as we reached 15.10. Consolidation followed above 15c before a new high was recorded at 15.13, and although we eased back from the highs it felt as though another push upward was not too far away. How wrong we were then, as despite a couple of early afternoon pushes which swiftly ended shy of the highs the market instead turned lower, giving back some of yesterday’s gains as we retreated into the range. Most of the movement continued to be driven by specs/algo’s emphasised by the movement in nearby spreads, March/May for example fell from a morning high of 0.34 points to 0.21 points as the spot month moved into deficit. There was an attempt to dress the spot month back up as we headed into the close however it was brief and unsuccessful as we ended the day at 14.71. Overall a disappointing session given the early promise though it does at least give the opportunity to unwind the overbought indicators a little, and with fundamentals remaining positive it feels as though it will only be a matter of time before we take a fresh look upwards
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