However, for the current 2007/08 crop year, merchants have sold about 5 million bales that are unfixed (potential buying) against about 845,000 bales bought but still unfixed (potential selling)
In other markets, after the January contract got to within 8 cents of it contract high, soybeans closed 12 cents higher for the week. Soy oil made new multi-year highs. Stuck in a sideways mode, corn gained a little over 2 cents for the period. Wheat, on the other hand, got in trouble and never got out.
Technically, wheat had a bearish outside week to the downside. It took out the previous weeks high; took out the previous weeks low and then closed 41 to 55 cents lower depending on the exchange.
Crude oil soared $3.26 to new all time highs. Gold gained almost $20 per ounce while silver picked up 65 cents. The CRB Index gained 570 points for the week but closed a dramatic 1,500 points above the low for the week. Of course, the dollar index continues to make new all time lows.
There are exceptions, but for the most part cotton has not been able to stand on its own feet for long. Speculative attitudes are inextricably attached to their overall view of commodities and the dollar.
Despite basically bearish fundamentals, prices have held steady with specs trading cotton in concert with outside markets and mill fixations along with fresh sales supporting prices on dips. Merchants are clearly net sellers on rallies.
Technically, December bounced off the 40 day moving average on Thursday and the 20 day on Friday. A close outside last weeks 6565-6345 range should be respected.
December 07 cotton goes into delivery in just 18 sessions. At this date, I would be quite surprised to see the spot month close above last weeks 6565 high. There seems to be plenty of selling on each probe above 6500 with both a diminished interest in buying that month in lieu of obvious preference for buying either March or Dec 08 instead. On the other hand, as long as outside markets stay relatively firm, support below 6400 from both specs and trade should keep dips in check. So unless there is an unforseen surprise in outside markets including the US dollar, spot December cotton may very well stay in the 6400-6500 range - plus or minus 50 points again this week as the spreads widen out. On the other hand, each new high in Dec 08 is a new contract high as that month continues to display a smooth methodical climb with great support between 7450 and 7350.
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