Wednesday, 24 July 2013

Goldman bottom on sugar and coffee?

Goldman announced that they are cutting their forecast on coffee and sugar prices. Whereas I think we are very close or perhaps already made a major bottom. Can it be that GS is accumulating them just after their announcements without bidding them higher because investors listening to their announcements would be selling aggressively? Am I too bad for thinking this? :)
Sugar's descending contracting triangle is unmissable combined with a positive divergence. The 10 year hypothetical blue channel has to deliver a bottom somewhere here or maybe it already had. We will see. All I want to see is a break up of the red triangle. Perhaps in a couple of months we can call this the Goldman bottom!
Coffee has been developing a double decker declining red channel since 2011. We have already hit the bottom of it and bounced back up. I would like to see a close above the green resistance coming from 2011 highs to be sure that the bottom is made.
Aussie dollar's short term resistances are very clear and we are testing that orange resistance again today. In case the blue ascending channel breaks down we may test the red channel's support again or even a new dip may be in the picture.
Aussie dollar and Gold is quite correlated since 2008 bottom. Despite some lags and leads, there is a tandem action between them. Since I'm expecting one more dip on gold, Aussie dollar may do the same in the next weeks. If the orange resistance breaks up, it will be extremely bullish though. So I'm bullish on Aussie with some caution.
Last but not least is the S&P. Not much action today so I held it back. The orange triangle seems to be breaking down. The blue rising channel can give good long opportunity with some tight stop loss control. Hope it helps.

2 comments:

  1. Great charts. Do you have any stock recommendations related to sugar if the price breaks up from here? Thanks!

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  2. I bought some of the ETF called LSUG. It is a leveraged ETF traded in London exchange. I'm sure you can find more of that stuff.

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