The cotton market is stronger Wednesday morning, with spot March as the leader. The market has been inverted for some time, which is having the front contract trading higher than the trailing futures. It is a sign of implicit, immediate demand. Traders are also bullishly inspired by the fact the Dow and crude oil are higher Wednesday as well.
Wednesday at noon EST, USDA will issue its January Crop report. Essentially, domestic stocks are expected to be slightly elevated, a result of the supply-chain crisis, while world stocks are anticipated to be lower, also a legacy of the supply-chain jam.
Wednesday morning the CPI (consumer price index), an inflation gauge that measures costs across dozens of items, rose 7% in December from a year ago. It was the fastest gain since June 1982. Excluding food and energy, the core CPI was up 5.5% on the year, the biggest growth since February 1991.
For Wednesday, close-in support for March cotton is 115.20 cents and 114.85 cents, while resistance stands at 118.50 cents and 119.00 cents. The estimated morning volume is 8,898 contracts.