DTN Cotton Open: Market Moves Higher, Watches Dow

    Cotton gin removal of module wrapping. ©Debra L Ferguson

    Despite the wild and violent collapse, and a subsequent recovery rally by the Dow Jones, the cotton market kept its cool Monday. Tuesday morning it is higher but is keeping a tight watch on the Dow. The Russia/Ukraine situation remains unresolved and scary, while the Federal Reserve will announce any monetary policy changes on Wednesday at 2 p.m. EST.

    This Thursday USDA will issue its weekly export sales report. While weekly sales waned somewhat last time, shipments were the strongest this year. If the market can sense the global supply-chain crisis is indeed mitigating, traders will see that improvement as a big positive.

    The U.S. dollar remains stout as it awaits news from the Fed’s two-day policy meeting. It is rumored the Fed will announce an interest hike as soon as this March. Higher rates translate into a stronger Greenback which, theoretically, can be a hindrance to exports of most U.S. goods, especially cotton.

    For Tuesday, close-in support for March cotton is 120.20 cents and 119.20 cents, while resistance stands at 122.00 cents and 122.80 cents. The estimated morning volume is 6,103 contracts.

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