Liffe Sugar (white)

bgold

Established member
532 5
SB N4 bounces off support (?)

Perhaps bit of a gamble but I am again long 1/2 position SB N (July) at 6.34. Stop at 6.05 (?)

Thusfar price held above support which I see as
a. .618 retracement of rally from the lows,
b. the M-line of 11 March, and
c. trend line (see chart).

Stops can be set at bottom of candle or perhaps a 75+% retracement of rally at 6.05. Problem is that wave 2 can almost fully retrace wave 1 before wave count becomes invalid.

I choose 6.05 which quite wide 5% (still less than todays' move) because I suspect the trade (market makers/insiders) to go for all obvious long stops (eg create some space below bottom long candle).

Perhaps better to wait for upside confirmation which requires trading back to 660-670's closing gap/falling window.
 

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bgold

Established member
532 5
Sugar bouncing back up!

This trade is working out well (unlike the Cocoa which collapsed).

SB N4 held at support and bounced nicely up from the 0.618 retracement of rally to the 7.25 high. Now at 6.93
Elliot wave count points to a top above 7.25

Long from 6.34, initial stop at 6.05, now raised to 6.67 (just below the rising window/gap). Will review stop level again for tomorrow.
See updated chart
 

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neil

Legendary member
5,167 748
Nice call.

Was there a reason for the sudden steep climb in March to 720, prior to the price dropping back to its' trendline?
 

bgold

Established member
532 5
July Sugar in P&F chart looks very bullish

For what it is worth, I couldn't resist charting sugar in PNF.
According to theory, as long as prices remain above the 45degree (fat) line, Sugar remains bullish.

Interesting to see that prices bounced exactly up from the 45degree support line. This would imply that sugar remains bullis for as long as prices remain above 635 (which is a too much risk for my stop), but a level to consider playing sugar from long side.

As for ultimate PNF targets (eg only buy & hold situations, which is difficult in futures with only a few months till expiry)
vertical count: 14crosses x 3box reversal chart x 0.05 = 2.10
horizonal count: 11 boxes from previous breakout x 3 x 0.05= 1.65
gives:
Vertical count: 6.30 + 2.1 = 8.40
Horizonal cnt: 6.30 + 1.65 = 7.95

Neil, I believe there were some demand issues (possiblky related to China) but main reason was a massive buying by hedgefunds who subsequently were shaken out by commercials (and probably locals) who shorted above 7.00. My understanding is that fundamentals are very good for sugar but it is a tricky market to play, so staying with main trend is probably best advice. ;)
 

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DaveT

Well-known member
434 6
July04 CSCE Sugar has been trading sideways for the past few sessions.

I see a possible bull flag formation( breakout objective 780), but a test of support may come first (?)

Long-tem , the weekly shows good upside potential.

See my charts below.

BGold - is your P & F 45' line holding? (basis July?)
 

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bgold

Established member
532 5
DaveT, Very interesting charts and analysis. I am also bullish on sugar but have to admit went flat yeterday after tightening stop to Fridays' close at 697. In hindsight not a bad move, let's hope i won't regret.
Having see the havoc in March, i decided to get out of 1/2pos at 701 and was stopped out on 696 for remainder.


My reasoning:
1. I was long full position from 634 and had added another 1/2position at 7.02. Range trading gave me the creeps (as flags do), and
2. Fridays' COT report showed a further increase of Large spec longs vs -122k for Commercials.
3. April rally failed to confirm March highs and various indcators do not point to imment strength.
4. Sugar bull spreads do not point to strength (may/July tightened a little but Jul04-Mar05 has gone down to -26 from -10 a week ago.
5. P&F (3box) is just breaking through bullish support (see chart).

I wouldn't be surprised if we get some more volatile trading in next few trading sessions.
 

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bgold

Established member
532 5
Suger bull spread Jul04/march05

Note how this spread has continued to widen since the colllapse in March.
 

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DaveT

Well-known member
434 6
JULY 04 CSCE SUGAR - Is the flag about to break out?

RSI holding trendline support, Stochastics point up and crossing?

Textbook target would give 775 by measurement.

Let's see.
 

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bgold

Established member
532 5
Seasonal tailwind may cause break-out!

Dave, thanks for reminder. I understand that many trendfollowers remain bullish above ~666
What should be the entry level? Above the flag at 693? Or nearer to recent high of 711?

Interestingly, according to MRCI, buying Jul Sugar on 4May and selling 16May would have been profitable 15 out of past 15 yrs (see chart).

For now calendar spreads do show some signs of bottoming but only very marginally. fyi I bot initial position in bullspread Jul04-Mar05 at -37. With (mental) stop at -50

Dave, what is your take on the signals (MACD & Stoch) you posted sometime ago? Sugar doesn't look like one (I am using the chart regularly :))

Anyway, it just feels that SB has another leg up targetting 775+!
 

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DaveT

Well-known member
434 6
Interesting seasonal , BGold....

To trade a possible breakout, you SHOULD (technically) wait to see at least 2 days 'clearance' to minimise the chance of trading a false break.

Or wait for a return move.

I have to admit that sometimes I break this rule, if the weight of the evidence' seems strong to me.

Re. MACD + Slow STOCH, I agree the signal is not set up right here. It seems to be better for siganalling the bigger trend changes, such as at the start of the FEB-March rally.

No one method, set of indicators or pattern is going to give 100% reliability. I would always look for confirmation in basic price action (eg trendline break, reversal pattern etc.) before trading off a momentum combination.

As Traders,we're deaing in probabilites. (ie, trading set-ups we feel have a high PROBABILITY of follow-through.)
 
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DaveT

Well-known member
434 6
July 04 Sugar with MACD + Slow Stochastic signal. :
 

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DaveT

Well-known member
434 6
July 04 CSCE sugar broke out of the BULL FLAG I highlighted today.

Demand news from Egypt plus low expected May deliveries was the catalyst.

1st resistance - old highs at 7.25

Pattern Objective - 775
 

bgold

Established member
532 5
Why are calendar spreads not confirming the sugar break-out?

Super rally in July Sugar. All the way from 675 lows to 711 in just 2days. I didnot participate :rolleyes: . Reason? Probably analysis paralysis! I am long the Jul-March05 spread and see that this spread has only marginally come-in and so has the Jul-Nov SBN-SBV (see chart).
These spreads seem to have been in a much more pronounced bear trend than SB N4.
What am I missing? Can somebody explain or do these spreads show that this rally is going to be a false break-out, once again triggered by funds and smal specs while the "big" boys (Commercials) are waiting for the kill?

Again, i didn't like the COT and neither the fact that just about everybody seems to be of the opinion that sugar is going to rally.
(i'll probably going to regret having missed the fun :eek: )
 

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DaveT

Well-known member
434 6
Bgold -

I don't follow the spreads so I don't feel qualified to comment on that score.

As for COT, I observe the report, but don't base my trading decisions on it at all really. Longs can get longer, shorts can get shorter...

Commercials are always positioned opposite to the funds and specs. They are long-term hedgers. We are looking for (relatively) short-term profits.

I just use my own TA rules of entry/exit/re-entry, with an eye on the fundamental developments and S/D picture.

Not infallible, ofcourse.
 
 
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