The cotton market did a major reversal Sunday night when China indicated they wanted more talks before signing Trump’s Phase One arrangement. Chinese state news media said China wanted to send another trade delegation back to Washington in late October to complete current negotiations before moving on to other differences.
The change in attitude sent December cotton from 200 points higher to 50 points lower. Other agricultural markets followed bearish suit. If the Chinese are going to be this fickle then the possibility of a serious trade deal looks unlikely.
The U.S. lifted scheduled October tariffs as a goodwill gesture, but still has December tariffs ready to go. Moreover, if there is a complete breakdown, the Trump Administration is likely to reinstate the October tariffs.
For today, close-in support for December cotton is 63.30 cents and 63.00 cents, with resistance at 65.85 cents and 68.35 cents. Overnight estimated volume stands at 15,365 contracts.