The cotton market spent the entire session Tuesday waffling between positive and negative levels, as last moment anxieties gripped the trade. Wednesday, at a White House ceremony, the world’s top two economies will sign the phase one trade treaty. However, traders’ fears will unlikely abate until they see the video of the actual signing.
The understanding is China will purchase massive amounts of U.S. goods and services. However, there is conflicting news that indicates, even after the signing, the U.S. will maintain its tariffs for a 90-day period for compliance reasons.
Of course, beyond that possibility, the U.S. retains the right to renew its duties on Chinese imports, even adding new ones, if China fails to live up to her obligations at any time.
Supposedly, an English version of the U.S.-China trade deal will be on the internet for public view ahead of the ceremony. Moreover, we understand that White House officials are bringing owners and producers, representing every major sectors of the U.S. economy, to help stage the event.
In a peripheral event, the U.S. house will send over Articles of Impeachment to the Senate. No matter one’s politics, impeachment is proving to be a highly distracting event.
The cotton market remains materially, having rallied some 7 cents since Dec. 3. Despite the entrance of bullish speculators, the market is technically vulnerable for a correction.
For Tuesday, March cotton ended at 71.38 cents, down 0.15 cent, July closed at 73.36 cents, down 0.27 cent and December finished at 72.51 cents, down 0.23 cent. Estimated volume was 37,641 contracts.