By Keith Brown, DTN Contributing Cotton Analyst
After Wednesday’s tumultuous decline, the cotton market was able to somewhat gather itself Thursday. In other words, there was no massive follow-through selling. Still, the market has been technically wounded, and with month’s end Friday, there may be additional squaring up. The 50-day moving average is coming in around the 66.80-cent area basis December. Of course, next Tuesday is the presidential election, meaning some traders will remain sidelined until that event is basically determined.
The market saw fairly decent export sales Thursday morning, with Pakistan as the top buyer. Unfortunately, the market’s needle moved very little on that news, and even that of Hurricane Zeta. Surprisingly, Zeta accelerated in strength as it neared the U.S. gulf coast. Unfortunately, in our talks with producers down that way, they shared their Louisiana cotton crop was now probably in Kentucky.
The U.S. dollar pushed higher Thursday, as Investors see it — rather than gold — as the safe haven trade. Of course, theoretically, a strong dollar is considered a detriment to U.S. exports. To that end, as COVID-19 infections rise, traders are flocking to the dollar.
For Thursday, December cotton closed at 69.82 cents, down 0.35 cent, March settled at 70.80 cents, down 0.23 cent and December 2021 finished at 69.03 cents, down 0.19 cent. Estimated volume was 38,196 contracts.