By admin       2019-03-06

Tuesday saw a classic example of a turnaround Tuesday event. On Monday the market was decisively lower, and looked bearish, but by Tuesday, the market had gathered itself and smartly rallied. In fact, old crop May Cotton looks poised to hurdle overhead trend line resistance at 74.70 cents.Of course, the fundamental driver for such a Tuesday has to be attributed to the belief that a U.S./China trade deal will happen. Also, as subscribers know, the market was steeply oversold, as a recent rise in open interest attests new short-selling speculators have piled in the mix. There is also a need for high grade cotton, given that so much of 2018’s grade suffered heat, hurricanes, wetness and freezes.This week, USDA will release its weekly sales exports report on Thursday, and its monthly supply-demand data on Friday. On the February crop report, 2018 production was lowered, along with domestic carryout. However, the 2019 crop is projected to be massive, with an extensive ending stocks number. Still, the number planted may not be the number harvested or needed if China comes back as a customer. Additionally, the world crop carryout saw a two million bales increase, but that amount might be challenged this go around.May cotton settled at 74.61 cents, up 1.48 cents, July was 75.45 cents, up 1.36 cents and December finished at 73.72 cents, up 0.57 cent. Tuesday’s estimated volume was 32,605 contracts traded.

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