By admin       2018-09-25

December cotton is trading both sides of Friday’s close as it tries to get a handle on various fundamental events now unfolding. Last week, the cotton market was down a net 270 points. At any rate, the damage to the mid-Atlantic crop is just now being assessed. Although, USDA will issue its weekly crop condition/harvest data Monday afternoon, the trade is sure its data will not be correct, nor final. In other weather news, there was some damage to the Indian crop as heavy monsoonal rains hit the Punjab region over the weekend. The crop there was on the edge of harvest when two days of heavy rains have punished the crop. In fact, schools in that province have closed due to torrential downpours. The Federal Reserve meets this week and with the Dow Jones knocking out all-time highs last week, the odds have increased for another hike in U.S. interest rates. Such a move would likely strengthen the U.S. dollar, which in turn may hinder cotton sales. On the other side of the currency pendulum, the Indian rupee continues to slide, and is now making new all-time lows. On the trade front, despite an olive branch tweet for President Trump last week to China, there seems to be no movement on the tariff front. In fact, China is planning a new tax on imported LNG from the United States. Several U.S. energy companies have spent millions at Chinese ports building LNG terminals. For Monday, close-in support for December cotton stands at $.7790 and $.7750, while resistance will be $.7995 and $.8060.

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