Blue Line Breakfast Report - Sugar Cocoa Coffee OJ - January 17

Blue Line Breakfast Report - Sugar Cocoa Coffee OJ - January 17

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Sugar




The 3rd best performing commodity of the year out of the basket of 48 we actively monitor at Blue Line Futures. The 7.9% performance has been mainly due to the positive supply outlook while expectations for a global production deficit continue to expand beyond the 6-million-ton mark. I have seen new projections with the high end of the range at 9 million tons.



From a traders perspective, the pullback we are saw yesterday is a healthy correction with the trend remaining positive. The breakout buy signal was on January 6th at 13.73 for March sugar and your first area of support is 14.18 and sell stop triggers down at 13.28. With ADX strengthening, stochastics in overbought territory and DMI+- widening out, it might be time to tighten up the stops and protect the equity in the trade.

*For traders working closely with me we took off some of the positions yesterday as there was a sea of red across the board. Look at it more as calling a time out on the field where we will reenter on the next upside breakout.

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Orange Juice



Down 4.36% on the year and 8th worst performing commodity, trend traders were triggered into shorts back on January 13, at 95.60 for the March contract. While this downward trend might feel like it has been going on for months many traders have to ask themselves, how much farther can it go? I looked back at the weekly and saw the likely target would be from May 2019 down at 90 even. Resistance is up at 98.20 and buy triggers are at 98.65. Watch for this market to cycle back up in this downward channel.







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Cocoa



The 2nd best commodity out of the basket of 48, up 9.06% on the year. North American fourth quarter grindings were released and came in at 5.9% well below trade forecasts however European grindings came in closer to expectations. It appears the market is shrugging off this data and focusing on the strength in equities and the weather in the Ivory Coast which has become hot and dry recently.

If you were able to get long on January 10th on V shaped breakout at 2588, be sure to trail stops and perhaps consider using a close below todays low as your risk parameters. Support is at 2675 and the sell trigger is way down at 2518.




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Coffee



The 2nd worst performing commodity of the year out of the basket of 48, down over 13.5%. From a traders perspective, this market has neither triggered a long or short and is still neutral, as a sell trigger would occur with a break below 110.50 or a buy over 132.92. While I do not expect a move back over 133 anytime soon, it feels like liquidations will continue driving the market back down to 105. Options may be the best way to tackle this monster for the time being.





Good luck and good trading,



Phillip Streible

Chief Market Strategist

312-858-7303

Phil@Bluelinefutures.com

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Futures trading involves substantial risk of loss and may not be suitable for all investors. Trading advice is based on information taken from trade and statistical services and other sources Blue Line Futures; LLC believes are reliable. We do not guarantee that such information is accurate or complete and it should not be relied upon as such. Trading advice reflects our good faith judgment at a specific time and is subject to change without notice. There is no guarantee that the advice we give will result in profitable trades. All trading decisions will be made by the account holder. Past performance is not necessarily indicative of future results