New York sugar ends down, range widens but does not break

Raw sugar futures finished lower in New York after keeping to a strict range for three sessions, but traders said they thought the selling was more consolidation business than indicative of direction. "We've seen producer selling on the upside. We've seen trade buying on the downside. And the funds were very mixed today," said one dealer. The dealer reported seeing two-sided trade by funds and speculators at the upper end of the range, and scale down trade buying continuing on the downside.
The New York Board of Trade's July raw sugar contract fell 0.08 cent to settle at 8.68 cents a lb., after moving in a range from 8.62 to 8.70 cents.
October lost 0.07 cent to end at 8.80 cents. The rest settled from flat to 0.10 cent lower. "A lot of funds are short and locals have been trying to push through some of the upper parameters to trigger stop-loss buy orders, but there's too much producer selling.
So we've been caught in this consolidation range," a trader said. One dealer said sugar trade should be caught in the current range for the next week and a half.
"I suspect that we're going to see consolidating action until we see July options go off the board on June 10. I wouldn't expect 8.50 to be punctured, because of the options expiration coming up.
And if there's not a reason to go up it will probably languish in a range," a trader said. Some funds were seen rolling long positions out of July and into October contracts ahead of the close.
Technicians see support in the July contract at 8.50 and 8.60 cents, with resistance at 8.90 and then 9.00 cents. Estimated sugar volume rose to 44,448, greater than the 36,380 lots traded on Tuesday.
Call volume increased to 10,123 lots and puts came to 2,135 lots. Open interest in the No 11 raw sugar market rose 180 lots to a revised 363,027 contracts as of May 31.
Ethanol futures closed flat, with the June ethanol contract at 117 cents a gallon. US domestic sugar futures closed mixed. July was 0.15 cent higher at 22.50 cents a lb.
September gained 0.17 cent to 22.29 cents. The rest ranged from unchanged to 0.02 cent higher. No 14 sugar volume hit 544 lots, from 825 previously.