Friday 📸: Portfolio Review & New Trades

Good Morning. We’re going to take a deeper look into the diesel market in a special edition of the Sunday note - check it out this weekend.

Let’s take a quick look at some new trades, and the portfolio. We took a couple new bullish options trades this week: one on cotton and one on a different and more common grade of sugar - ticker SB - or Sugar #11.

For cotton - volatility rolled over into consolidation and gave us a new shot at this trade that’s already in an uptrend. So far this year, cotton has done good things for the portfolio - registering gains from the long and short side. But even if we had tried and the trades didn’t work - we’d still keep trading as long as the setup follows our system. This is a beautiful setup of what was resistance (indicated by that first blue arrow at left) becoming support (arrow at right).

Here’s commodity performance over the past month:

For sugar (SB - we are already long White Sugar) - I wouldn’t always take this trade, as price is just entering the weekly cloud here. But the environment is right: the dollar continues to be weak and choppy, financial conditions are easy, supply disruptions persist, diesel and transportation costs have increased, tail-risks like the El Niño weather pattern have emerged, and the commodities ‘softs’ (Lumber, sugar, cocoa, coffee, cotton) sector has been moving higher as a whole.

From the USDA’s 2026-27 outlook on global sugar supply and demand:

Global sugar production is forecast down 1.2 million tons to 184.9 million with lower production in Brazil, the European Union, the United States and Thailand expected to more than offset higher India production. Exports are forecast down slightly to 62.3 million tons with reduced exports from Brazil, the European Union,Morocco, and Pakistan more than offsetting higher shipments from Australia. Ending stocks are forecast to rise slightly, primarily in China and India.

There’s all that, and volatility is incredibly low - making options cheap. Time to take a shot.

Swing Portfolio Performance YTD: 12.57%

See you this weekend,

-Andy