By admin       2018-10-01

December cotton is lower overnight as the third quarter of 2018 comes to a close. The range of this period has been a high of $.8998 to its present $.7772, but the day is not over. However, during this quarter the market has suffered through a drought, a trade war, a strong dollar and revolving supply-demand reports. Yet, overall we can attest the market’s behavior this year has been quite “normal,” in that it rallied to highs in the spring and is breaking into harvest. Such action reflects the seasonal tendency of the market. Currently, the market is suffering from slack participation from its international customers. Just Thursday, USDA reported a marketing-year-low sales number. Still, as of Sept. 20, cumulative cotton sales have reached 62% of USDA’s 2018-19 forecast versus a five-year average of 42%. The difference of that pace has us wondering will there be cancellations in cotton’s future. For now look for the market to push prices lower into harvest. In addition, to the normal hedge-type selling to emerge, the huge net-long position of speculators is being threatened. Thus, if they elect to come loose, the market could become ugly to the downside. December support comes at $.7700, and $.7590, while resistance stands at $.7870 and $.7960.

Download App

# #

Member Login