By Keith Brown, DTN Contributing Cotton Analyst
The cotton market spent the day in “quiet correction” with narrow ranges and low volumes. Of course, coming into Friday’s trade, the market had already experienced a stout bullish run. Traders spent the past several days dialing in the positive influences of robust supply-demand data, surging export sales and a weaker U.S. dollar.
Southern cotton gins seem to be winding down their 2020 processing activities. In polling several area gins, managers indicated they had three weeks left in their harvesting season. Typically, the harvest encompasses the Oct-Nov-Dec window.
The U.S. dollar was higher Friday, reflecting its oversold condition. Currency traders have been outright selling the U.S. Dollar Index, as well as bear spreading the dollar to the yen and the eurocurrency. The Federal Reserve’s policy of maintaining virtual zero interest rates, the potential for a generous stimulus package, as well as the distribution of the COVID-19 vaccine are collectively pushing the dollar down.
Next week the market will observe the Christmas holiday. It will close at 1:05 p.m. Thursday, Christmas Eve, and of course all-day Friday, Christmas day. To reiterate, USDA’s weekly export sales will be released Wednesday morning at 8:30 a.m., as the U.S. government will be closed both Thursday and Friday.
For Friday, March cotton closed at 77.16 cents, down 0.03 cent, July settled at 78.38 cents, down 0.10 cent and December cotton ended at 73.77 cents, up 0.15 cent; estimated volume was 22,081 contracts.
Source: Agfax