New York Sugar No. 11: Time for a sugar rush?
NY sugar prices has punched to a three-week high this week, with the catalyst attributed to potential global supply disruptions caused by drought and excessive heat in Brazil’s top sugar-producing state of Sao Paulo. Sugar cane industry group Orplana mentioned that there were as many as 2,000 fire outbreaks this weekend, with potentially as much as 60,000 hectares of crop area being affected.
Technically, a close above a downward trendline resistance may be significant, which raises the odds that sentiments are reversing from its extreme bearish state over the past year. Its daily relative strength index (RSI) has headed above its mid-line for the first time since in a month, following a bullish divergence formation on recent lower lows in prices.
Prices are likely to seek for a retest of its July 2024 high at the 20.66 cents/lb level, where its 200-day moving average (MA) will be put to the test. Any weakness will likely leave immediate support at the 19.36 cents/lb level on watch.