Sugar Sinks Below Key Support: Bears Take the Lead
13 November 2024
Sugar is currently in a critical bearish phase, mirroring the broader negative sentiment present across many commodities. This shift comes after a significant breakout below a key horizontal support level, marked with an orange line on the chart. This level had acted as a solid base for a few months, stabilizing prices amid fluctuations. The recent drop below this support indicates a change in sentiment, emphasizing sellers' control over the market.
This breakout wasn't just a one-time event; the price returned to retest the broken support level, which was now acting as a resistance. Both yesterday and today, attempts to move above this resistance were rejected, resulting in pronounced bounces and further downward pressure. These failed retests reinforce the strength of the resistance and signal that sellers are ready to defend their position.
Adding to the bearish outlook, the price has also breached the midterm uptrend line, marked in black. This uptrend line had been guiding sugar's price action upward for several weeks, providing a basis for optimism among buyers. With the price now below both the critical support and this trend line, the technical picture has shifted decidedly negative.