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Sugar Futures: Market Sentiment Is Key
Elliott Wave International discusses the current sentiment reading in Sugar futures and its implications for the trend.
According to Tom Denham, Elliott Wave International's Senior European Stocks Analyst,
"Sentiment is the filter through which investors and analysts evaluate everything they know and think about stocks. Optimistic people easily accept a drop in earnings and focus on management's vision for the future to stay enthusiastic. Pessimistic people dismiss past successes and focus on fears that the environment ahead is challenging."
This statement equally applies to commodities as it does to stocks. It's a timely quote, too – because sentiment in Sugar futures, for example, happens to be pretty optimistic right now.
The Daily Sentiment Index – whose readings below 20 indicate an extremely bearish sentiment and those above 80 indicate extreme bullishness – is at 84 right now for Sugar:
This chart – except its fully labeled version – appears in tonight's (Mar. 12) issue of Elliott Wave International's daily commodity publication, Daily Futures Junctures.
Notice, though, that this is a weekly chart of World Sugar. While on this longer-term timescale, traders' sentiment may indeed be indicating overbought conditions, a shorter-term timeframe may offer a different picture.
You can see our full analysis of Sugar online right now, in the March 12 Daily Futures Junctures. Just look below for details on how to get it