After Monday’s tumultuous session, Tuesday’s market was able to play its turnaround Tuesday card and finished higher. Some traders indicated one reason for the snap-up was the market was short-term oversold. However, in the back of many minds rests the notion of “what if.” That is, what if China begins to either buy U.S. cotton or, at least, stop cancelling old purchases.
Supposedly, the next meeting for the U.S.-China trade talks will happen in November in Chile, as both sides will be attending the Asian-Pacific Economic Summit. To that end, it’s thought the Phase One deal will be signed at that time.
Technically, the market has overlapped its September 13 high last Thursday, which changed the look of the chart. That is, a bear market is one in which there is a series of lower lows and lower highs. So, when that last lower high is bullishly violated, it encourages traders to think the bearish trend may be changing to, at least, a neutral trend.
Weekly sales and exports are delayed till Friday morning, as the Columbus Day holiday had the USDA tabulators off for the day. As it stands, sales are running equal to slightly better than the five-year average pace.
For Tuesday, December cotton settled at 63.53 cents, up 1.31 cents, March was 64.26 cents, up 1.08 cents and December 2020 finished at 65.97 cents, up 0.69 cent. Estimated volume was 40,760 contracts traded.