Sugar #11 May’22
The week began with the market on the front foot, specs showing interest across the whole commodity sector to take prices upwards, reaching to 19.56 for May’22 before pausing. A morning of slow consolidation followed as scale selling limited any further gains, though with specs content to hold the longs in line with the wider macro direction prices remained positive moving into the afternoon. There was no reaction from US specs as the Americas day got underway however the positive technical picture combined with further macro gains soon combined to bring some additional interest that sent values running higher once again. Last weeks highs in the 19.60’s were quickly breached as volume surged before heavier selling in the 19.70 region led prices to stall. The next technical point to target was 19.89 (high, 7th March) and the persistence of the longs led prices upward to 19.77 however the buying dried up and the move ran out of steam before getting near to this point. Slipping back into the range one may have expected the market to make another attempt higher however there was to be no more fireworks and outright positions meandered quietly towards the close. With the index roll commencing later in the week we saw an increased volume of May/Jul’22 spread starting to be moved today, the differential widening a little along the way and ending the day at 0.19 points. May’22 meanwhile settled at 19.61, a positive conclusion though still providing the feeling that the higher levels are sustainable only with macro backing at this present time.
