If you're looking to invest in a commodity with high trading potential, sugar has seen significant price fluctuations in recent years.
Sugar prices have been rising due to increased demand in countries like China and India, which is likely to continue. Many factors affect the global sugar market, ranging from political and economic factors to environmental and health concerns. Sugar prices also have a historically low correlation with the overall U.S. equity market, making sugar an attractive option, as represented by the Teucrium Sugar Fund (CANE) shown above.
Sugar remains a profitable commodity for those who understand the market risk.
Sugar futures are one way to invest in sugar. A select few exchange-traded funds, like CANE (see chart above) provide access to sugar futures through an ETF. CANE provides investors with an easy way to gain exposure to the price of sugar futures.
On the daily chart, our proprietary Real Motion Indicator suggests that CANE'S price can continue higher. CANE is above the 200-day moving average, and our Triple Play Indicator exhibits new leadership performance. CANE is attempting to overtake the SPDR S&P 500 ETF (SPY), indicating a possible change in leadership.
Another way to get exposure to sugar is by purchasing stock in a company that makes foods or drinks with sugar. This strategy does put all your eggs in one company, for example, Coca-Cola (KO), which is up 6.8% year-to-date. KO is an excellent example of a company with a premium product and pricing power. KO's stock is in a bullish phase and can raise the price of its products.
Our platform offers trading ideas, like CANE and KO, with real-time alerts for buys and stops, so investors can make informed trading decisions, such as when to buy or sell. In addition, we also offer live trading analysis of markets, including the sugar market, and provide our analysis available on private video demand so investors can understand and review what's driving the market and the pricing of specific commodities.
If you are looking for a sweet trade with the potential for significant returns and vol, sugar may be just what you're after. Please remember that when it comes to higher sugar prices, turmoil and chaos are often around the corner. So, stay alert and manage your risk.
Rob Quinn, our Chief Strategy Consultant, can provide more information about our commodity trading and Mish's Premium Trading Service. Click here to learn more about Mish's Premium trading service with a complimentary one-on-one consultation.
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- S&P 500 (SPY): 396 support, 404 resistance.
- Russell 2000 (IWM): 179 support, 185 resistance.
- Dow (DIA): 337 support, 343 support.
- Nasdaq (QQQ): 284 support, 290 resistance.
- KRE (Regional Banks): 58 support, 63 resistance.
- SMH (Semiconductors): 218 support, 224 resistance.
- IYT (Transportation): 222 support, 229 resistance.
- IBB (Biotechnology): 133 support, 138 resistance.
- XRT (Retail): 62 support; 68 resistance.
Director of Trading Research and Education