SUGAR

Sugar prices are now testing a 5 year-long trend support. Since the beginning of 2007 prices have been moving higher. Swings in the uptrend have been sharp and volatile. It is now the 5th time sugar is testing the long-term trend support at 18.90 levels. Relative Strength Index formed a positive divergence on the weekly scale suggesting weakening downward momentum and warning of a possible reversal. From a long-term perspective sugar is offering a good risk/reward trade opportunity. It is important for the price to hold above 18.90 levels in the following weeks. In case of a rebound from the strong support levels price can test the 200-day moving average at 22 levels. Watch sugar prices with a possibility of a strong rebound.