The May contract looks to be heading into an abyss prior to it's first notices, which has become the norm for spot cotton. There are only 3 occasions (all structural squeezes) in the last 12 deliveries where prices haven't been beneath 48.00 cents at delivery, and this May delivery sure looks to resume the normality.
More damage to the May chart as it appears to have completely given up of late. The combination of heavy index long bear spreading and hedge fund selling have completely skewered values. Today the important psychological barrier at 50 cents was penetrated, which basically opens up a lot of targets on the Moving averages are both trending lower, with the 9 day now at 51.57 and the 50 day at 53.12.
Momentum continues negative with the RSI down to 24.55. This momentum continues in oversold territory.
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