The cotton market is trading higher overnight as bargain-buyers are out in force. Thus far spot December has held its low of Wednesday which is considered a positive technical nuance. Fundamentally, the market is trying to digest the not-so-friendly numbers USDA issued for the world categories in its October crop report.
The market hopes to get back on a bullish track with Friday’s weekly export sales report. That data was delayed one day and will be out Friday at 8:30 a.m. EDT.
Given the lateness of the majority of the U.S. crop, harvest is running behind. USDA will update that situation come Monday afternoon. To that end, several weather forecasts show heavy rainfall in central Texas, Oklahoma and parts of the Delta over the next one to five days. Longer-term, conditions lean towards drying out.
Traders are also anticipating Friday’s CFTC update for its various trader categories. Last week saw the managed-money funds approaching 100,000 net long contracts, but after this week’s rumble that number is likely to be pared.
For Thursday, close-in support for December cotton is 103.50 cents and 102.70 cents, while resistance stands at 107.00 cents and 108.10 cents. The estimated morning volume is 11,649 contracts.