DTN Cotton Open: Struggles to Keep Recovery

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After experiencing a massive end-of-the-month break last week, the market is trying to maintain its bullish posture. Some speculators are suddenly unconvinced of the market’s true underlying trend. Additionally, weakness in the Chicago Grains, and other commodities markets, are weighing on cotton.

The U.S. dollar is higher Tuesday morning. The market sees dramatically falling COVID infections, as well as the improved vaccine possibilities from Johnson and Johnson may bring viral resolution even faster.

Spot March cotton saw three new notices issued today, but with different participants. Macquarie Futures, who stopped three notices on Monday, tendered them back today. The stopper was SG Americas. Delivery ends next Tuesday, March 9.

Over the next several days the market will see hopeful decisive news. First there is this Thursday’s weekly export sales form USDA, followed by Friday’s jobs report from the Labor Department. Then next Tuesday, March 9, USDA will issue its latest update on cotton’s supply-demand situation. Suffice it to say, those numbers all need to be friendly.

For Tuesday, support for May cotton is 90.50 cents and 89.20 cents, with resistance at 92.80 cents and 95.60 cents. The estimated morning volume is 8,570 contracts.

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