Cotton is higher today even as outside markets flounder. Last week saw steep losses in the Chicago grains, which did influence cotton lower. Still for the week, the cotton market did finish higher. Last Friday’s positive export sales helped the market keep its friendly attitude.
Friday’s Commitments of Traders report showed managed money traders were net sellers of 1,849 contracts of cotton for the week ending January 19. That reduced their net long to 67,853. Trend-following traders have been net long for some nine months and other traders fear they may be getting weary with their bullish positions.
Last week’s export sales report showed cumulative sales for 2020/21 have reached 12.157 million bales. This amount was up from last year’s 11.859 million, the highest level since the 2010/11 season. Sales have reached 86% of the USDA’s forecast for the marketing year versus a five-year average of 73%.
The Federal Reserve meets this week to decide monetary policy. Its decision will come on Wednesday at 2 p.m. EST. Traders expect no change in rates. The U.S. dollar is slightly higher Monday morning.
For Monday, close-in support for March cotton is 81.30 cents and 80.80 cents with resistance at 83.10 cents and 83.50 cents. The current estimated volume is 9,270 contracts.