Has Sugar Bottomed?
What you see is a continuous chart of Sugar . In my opinion, I'm thinking that there is a reversal in trend that is about to take place and here's why.
The first thing that you may see is the downward slopping trend channel which began in October of last year which depicted a clear bear market. In late June of this year, prices broke through the bottom of the channel and created what I consider to be an obvious selling climax. Preceding the climactic selloff was a shortening of downward thrust, which showed stopping action in the market's selling. Since then, prices have moved sideways, creating a base. One thing that stands out about this base is the fact that the supports continue to rise, which is an indication that bulls are buying at higher levels each time the price falls. As I type this, prices are at the top of the range. Does this mean that there will be a breakout? I wouldn't go that far. After all, there was a false breakout on July 31st, which was checked at the overhead of the April '17 low.
Another case for a reversal, going back to the selling climax, is that the wave shows continuous increases in in the buying waves. Such action indicates that demand is overcoming supply. Something to note is how prices are pulling away from the bottom of the channel as it forms what may be an accumulative base.
Conclusion: I'm gonna have to see a strong close above not only the top of the accumulative base but also above the April '17 swing low. Such action will be a signal to get long following a pullback to test the breakout area. On another note, I find it interesting that Sugar , or any commodity for that matter, is setting up for a potential move to the upside as the U.S. Dollar is about to make a strong move to the upside as well. A strong dollar is usually for , but hey, we can only listen to what the charts tell us, right?