Sync data on external drive to iCloud
You can move the Documents folder to the external drive and create a symbolic link to Documents folder present on the external drive in your Home directory.

Follow the steps mentioned below:


Move the contents of the internal Documents directory to external Documents directory.
Rename the internal Documents directory. (You'll need to do it via Terminal by executing mv ~/Documents ~/Documents-old as Finder won't allow renaming.)
Open Terminal and create a symbolic link to the external Documents directory in your Home directory.

ln -s /Volumes/&lt;EXTERNAL_DRIVE&gt;/Documents ~/Documents


Now verify that the iCloud sync is working all-right. The old internal Documents directory (which was renamed in step 2) can be safely deleted.