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Hugo in HTO Trading,

Sugar: Recovers from five-year low

Sugar prices have fallen below the cost of production across India due to weak demand and mounting stockpiles so Indian Government passed long-awaited decision to reintroduce a subsidy on raw sugar exports.

The decline was also attributed in part to reduced concerns over drought in Brazil, with excess rain now becoming an issue in some parts of the key Centre South region.

Sugar during yesterday session initially fell but quickly recovered and closed in the red, near the open of the day creating a doji pattern. The commodity remains in a bearish phase and is forming a potential triple bottom pattern. The stochastic in showing an oversold market and may represent a good buying opportunity.

Expecting upward move to 14.78 (scenario 1) or even up to 15.15 (scenario 3) on a break above previous day high at 14.39.