Prices came in being offered at 48.00 right off the bat from a spec house, however some good trade bids on the opening effected an unchanged opening.
It was soon apparent that there was some good overnight export business, even though little of it must have been US origin cotton.
What ensued was a steady bid higher market through the first hour, with Dec reaching near 49.00 cents before running into any decent sized commercial resistance.
Locals must have been somewhat disappointed that Dec couldn't break it's price floor at 48 cents yesterday or this morning and duly covered their shorts throughout the session.
Prices completely lulled during the mid session, having fallen back to around the 48.60 level, and it wasn't until the final 30 minutes when prices fluctuated, first testing the 48.30 level and then bouncing back to the highs on the close, with commercial buying chasing the close along with local buying.
Estimated volume was not too flashy, with 11,500 lots changing hands. Prices finished some 42-52 higher, taking back much of yesterday's gains.
This morning US export report was somewhat of a let down, with a net total of 172,700 bales of upland and Pima being sold. Turkey was again the main buyer, contracting 54,700 bales. Shipments were again sluggish, with a total of 114,000 combined bales shipping for the week.
Technically the December contract continues to adhere to it's bearish down trend channel. Today's session adds a slight amount of structure, as yesterday the Dec could not penetrate down through the old contract low.
If anything this could lead to a more consolidating type of action over the next week between the 48.00 and 50.00 area, however with so many of the momentum and trend following indicators pointing lower.
It has to be assumed that new lows will eventually made beneath 48 cents, and that the trend channel will continue to lead prices down the proverbial rabbit hole leading into the December notice period next month.
marketing@alchempro.com
