The CANE (sugar ETN) long swing trade has hit the first target, T1 at 7.37, for a 4% profit after falling 2 cents shy of that level on back on Sept. 13th. Due to the sub-par tracking performance vs. sugar futures as well as SGGFF coupled with the fact that both /SB & CANE are now at resistance, I have decided to revise T1 to the final target.
As stated in previous updates, for years my preferred ETN proxy for trading sugar was SGG, which was recently retired by Barclay’s iPath series of ETNs & replaced with SGGFF. I wasn’t sure of the reasoning behind the changes so I opted to use CANE (Teucrium Sugar Fund ETN) this time around but noticed that CANE lagged both /SB (sugar futures) and SGGFF on the initial rally following the breakout when CANE was added as an official trade.
I still like the intermediate & longer-term outlook for sugar & as such, longer-term traders might opt to continue to hold CANE while raising stops to protect profits or roll into another sugar trading proxy such as /SB or SGGFF.
The daily chart of /SB above show that sugar futures have hit my first target where the odds for a reaction are elevated but quite often, when commodities bottom, they can mount a powerful rally that slices right through the initial resistance levels. As such, longer-term traders holding out for additional upside in sugar might consider raising stops to protect profits while riding out any potential near-term pullbacks. I am also considering adding SGGFF as a new official long trade if/when I see an objective entry.