There was mixed activity during the early part of the session however prices soon settled down and spent a period holding near to unchanged levels, a steady start given that the wider macro was generally weaker. A breakdown then followed with some long liquidation noted as May’22 spiked back down beneath 19.40, however the losses were stemmed and the market was able to consolidate through the rest of the morning without any significant damage being inflicted upon the recent positive picture. The situation remained the same until the start of the Americas day at which stage some fresh day trader buying pushed May’22 back toward opening highs, however there was no depth to the move leading values to fall back and register a marginal new session low. Volume was very low once more with most traders remaining to the side, though the spread activity we were seeing inflicted some losses upon the May/Jul’22 which edged back down to 0.11 points later in the afternoon. To their credit the specs did not let the market fall any further with their afternoon activities ensuring continued play within the range and ultimately a close just 0.03 points lower at 19.59. Today represented an inside technical day, and a steady performance in the context of the losses seen elsewhere in the commodity macro. This will provide encouragement to the longs that they can make further gains should other markets turn around and garner the additional support of system buying, time will tell as to whether we see this happen. 

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Jon Whybrow

Jon joined CZ in 1991, working in the Treasury department before moving to join the derivatives team in 1994. Over 30 years Jon has built up significant experience across derivatives markets and products, particularly sugar, and is now Head of Flow derivatives providing market execution services for CZ’s global client base. He is responsible for the market commentaries which are published each day on CZ app.

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