After its dramatic rally of Monday, the cotton market is witnessing additional buying Tuesday morning. Those participants likely include sold-short speculators covering their positions, and bargain-hunting buyers trying to pick a low.
Whatever the reason, the cotton market seems to be setting up for its third higher session. A strong Dow Jones is lending some peripheral support as well.
This Thursday, USDA will report on weekly export sales. The top fear is foreign customers may cancel or delay previous purchases as they shutter their factories to fight the virus. Thus far, that has not happened.
Monday, USDA issued its first planting progress report of the 2020 season. The nation’s crop was 7% planted versus 2% same time last year and 2% for the ten-year average. Texas was 12% planted with most of the Southeast, including number two producer Georgia, at zero percent seeded.
For Tuesday, support for May cotton lies at 52.10 cents and 51.20 cents, with resistance at 53.90 cents and 54.85 cents. Overnight estimated volume stands at 8,240 contracts.