There is an old trading saw that suggests if a gap holds for three trading days, the market often goes the way of the gap. In this case, the gap suggests a further upward move. Interestingly, volume was not commensurate with the market’s range. Estimated volume Wednesday was 19,600 contracts.
Part of Wednesday’s trading timidity may be the result of the federal government being closed. That closure included the Federal Reserve, USDA and the U.S. Postal Service in remembrance of the passing of President George H.W. Bush. Thus domestic money flow was at a virtual standstill Wednesday.
Normally, Thursday’s market would see weekly sales and exports, but due to the Bush funeral, that report is delayed till Friday. Also, Friday, the Labor Department is scheduled to release its monthly jobs data for November. Given the current wobbly tone of the stock and financial market, a strong number would help the psyche of all markets.
Thursday is the final trading day for December 2018 cotton. There were total of 77 deliveries. Term Commodities issued 13, while Wells Fargo tendered 64. SG Americas stopped all 77 notices. Thus far, there have been 904 notices.
Wednesday, spot December settled at 80.11 cents, up 1.34 cents, March was 81.15 cents, up 1.34 cents and December 2019 finished 78.37 cents, up 0.33 cent.