2011 has so far favoured the bears in Sugar, following the test of a long term Fibonacci level which provided strong resistance. Certain supports have been reached, or neared, which suggest a recovery phase is in the offing.
- SUGAR 11 –MONTHLY CONTINUATION CHART
There was a clear negative reaction after the test of the long term76.4% retracement.
The downmove has now got close to the level of the old 19.73 2006 high, as well as a bull channel base projection not far beneath. - DAILY CHART –Jul-11:
In our 17thMar Update on Sugar we said that the bear picture should have the power to extend to the 61.8% pullback. On the Jul-11 chart this nicely coincided with the Nov-10 low area.
There is now a good prospect of a better recovery phase getting underway.
Note the last downleg segment from the 24.00 area coincides with the 38.2% bounce –temporary resistance would be likely here. Higher resistance of interest comes from the rising return line around 25.50 currently.
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