Sugar futures declined as anticipated and completed a breakout from a Channel Up chart pattern, with the minimum target projected by Autochartist now achieved. The minimum for the range has now seen a successful retest in the form of a double bottom at the 26.40 cents per pound level. This is approximately a 2 cents per pound decline from the swing high, with the market now showing support for a possible resumption of the uptrend in store for tomorrow's session.
A higher open on Monday with any follow-through momentum should set the stage for a rally back to the underside of the channel with a retest of the previous highs. This would set up a new pattern on the Autochartist platform on a shorter time frame, possibly a Triangle, with a projection for a breakout point to the upside.
If sugar opens weaker and moves back into the projected target area on the chart, traders will be watching for a continued decline towards the bottom of the range at 25.52 cents per pound. This is a strong support area and a potential price reversal point.
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