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Tuesday, April 6, 2010

Sugar, its in the name

For whatever reason, I have an urge to buy the crap out of SGG right now. I do not know why. (Maybe its because my last name is tied into the commodity. I like to think my great great grand-father was a peasant sugar farmer, and was given the last name :)

But seriously, discipline prevents me. There is simply not as much information around Sugar then there is Crude or Nat. Gas, for investors outside of larger commodity desks to get a very clear assessment.

From what I gather, sugar will still see a deficit, which should provide a floor. If I were on a big-boy trading desk, I have probably purchased the factory input information from the sugar-cane processing plant to assess the increase of supply. But all I have at the moment are my charts and the Internet.

I still own SGG, and I do not plan on selling it just yet. However, there is no dressing up this pig. The only positive aspect of Sugar right now is the severity of its oversold condition.


  1. Sugar is not doing good, should I get out?

  2. i can't tell u what to do.

    The underlining commodity shows some support around 15, which should translate to SGG at current levels.

    look at the two yr chart...

    But the strength to that support, I do not know. I don't trade the actual future so I don't understand the contract's trading dynamic.

    The SGG show support at current levels too, but its board. The potential to see low 40s is there. (the weekly does not suggest it, but the possibility is there)

    I can tell you this, anytime i am uncomfortable with a position, I do not hesitate to sell and step back from that trade. (just like i did with GOOG earlier in the year. I took a sizable loss, and did not play it breaking out.)

    There is always another opportunity.

  3. Thank you for your response. One more question, when Stock market goes down, does commodity (i.e. Sugar) go down with it?

  4. I have not seen that correlation with Sugar, unless the sell off is a fund liquidating. it generally trades on the condition of sugar production/consumption and deficit.