Cotton Edges Higher, Awaits Exports
The cotton market settled higher Wednesday as, technically, it is maintaining its upward slope and, fundamentally, expectations are for decent export sales Thursday. To the latter, given the U.S. dollar has been on a downside tear, traders are thinking some cotton business was done. Additionally, the S&P and the Nasdaq have posted new highs, with the Dow Jones in hot pursuit. The psychological effect of seeing the stock indexes carving out a v-bottom is definitely friendly to cotton.
Last week saw net sales for 2020-21 at about 7,000 bales. Weekly shipments totaled 278,600 bales with China taking 157,100 bales. However, the most meaningful number from last week was the 2,883,200 bales rollover from the 2019-20 crop year into the 2020/21 season. Of course, now the 2020 season is on its own.
The speculators remain bullishly invested in the cotton market. Last week saw the money-managed funds have increased their bullish stake in the market. A new status report will be released Friday afternoon when the CFTC issues its information.
Wednesday, December cotton closed at 63.77 cents, up 0.84 cent, March cotton settled at 64.69 cents, up 0.86 cent and December 2021 closed 64.10 cents up 0.61 cent. Volume was 15,911.