Sugar Hits Sweet Spot As Gold Shines

It was a slow day out there, but several commodities caught traders’ eyes. Let’s see which ones. πŸ‘€

First up is sugar futures, which have experienced a nearly 30% decline since the beginning of November. While its major decline is one reason to be on people’s radars, technical traders say prices have reached the 20-20.50 area that served as an inflection point over the last two years.

They’re looking for prices to dig in here and potentially retrace some of this steep decline over the coming days and weeks. πŸ’΅

Meanwhile, on the other end of the spectrum, we’ve got gold futures trying again to break out above resistance near 2,090. The precious metal gave it a go earlier this month, but was unable to close above that level it failed at several times over the last few years.

With volumes being lighter during this holiday trading period in the markets, some traders say this is a great opportunity for buyers to step in aggressively and complete this breakout. πŸ‚

We’ll have to wait and see how these play out. But in the commodities space, these two charts are some of the most widely talked about in our community. πŸ’¬

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Cocoa Prices Go Loco

With Halloween coming up next week, some consumers will likely be shocked at the price of candy due to the elevated price of cocoa.  😱

The vital ingredient in chocolate is hitting its highest levels since 1979 as hotter and drier weather patterns stunt this year’s crop. Roughly 75% of global cocoa beans come from the Ivory Coast, Ghana, Cameroon, and Nigeria, where consistent temperatures, high humidity, abundant rain, and nitrogen-rich soil allow it to thrive.Β 

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Natural Gas Is Moving Fast

Okay, maybe not fast. But it certainly is moving differently than it has been. After falling about 80% from its highs from August to March, natural gas futures have been taking the first step to reverse their trend…stop going down. ⏸️

Below is a daily chart of natural gas futures trading in a $2.00 to $2.65 range for the last five months. But this week, traders are putting it back on their radar due to its strength relative to the rest of the energy commodity complex. With crude oil, gasoline, and heating oil all falling several percent this week, natural gas’s nearly 5% gain certainly stands out. πŸ€”

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Grains Lose Their Gains

Grain commodities were the talk of the town for a bit during the pandemic, as soaring prices pushed up producer and consumer inflation. They’ve not gotten a lot of headlines lately, as a slow and steady decline is less interesting than a sharp increase. 😴

However, they were back in the news today after making a swift move lower. The USDA quarterly grain stocks report showed higher stocks and production than initially anticipated. Wheat was hit the hardest, though soybeans and corn were both down too. πŸ“‰

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Oil Returns To The Status Quo

The U.S. oil market is returning to its pre-pandemic norms, at least according to the manager of the popular oil ETF $USO. πŸ›’οΈ

The United States Oil Fund ($USO) has been around since April 2006 and is a futures-based ETF that looks to track the price of U.S. crude oil. It does so by purchasing the front-month sweet light crude oil (WTI) contract, holding it, and then rolling its holdings to the following contract before expiration.Β 

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