* Profit-taking depresses market, but off day's lows
* Chinese mill buying propels cotton to 15 year highs
NEW YORK, Oct 12 (Reuters) - Cotton futures closed lower Tuesday on mild investor profit-taking after scaling a fresh 15-year high, with analysts saying the market's recent momentum may lead to a shot at record highs.
The market climbed to a new 15-year top mainly on buying by No. 1 cotton producer and consumer China, whose massive textile industry is scrambling to book orders after coming back from a holiday which ran from Oct. 1 to 7.
"It sure looks like it wants to climb (to) $1.15," Jobe Moss, an analyst at brokers and merchants MCM Inc. in Lubbock, Texas, said, adding the market may even probe the record highs beyond $1.17.
"I think it's the mills again," said Lou Barbera, an analyst for VIP Commodities brokerage. He added small amounts of speculative fund buying trickled into cotton from accounts who believed the market will head higher due to strong demand for the fiber.
ICE Futures U.S. key December cotton contract CTZ0 fell 0.92 cent to close at $1.0958 per lb. The contract touched a session and 15-year top at $1.1238 hit during overnight.
Volume traded in the market stood at an estimated 21,339 lots at 2:38 p.m. EDT (1838 GMT), some 7.0 percent above the 30-day average at 19,991 lots, Thomson Reuters preliminary data showed.
Another source of inspiration for cotton was news India has suspended cotton export registration after receiving applications for the stipulated exports of 5.5 million bales. [ID:nSGE69A0AA]
The announcement is potentially bullish for cotton futures because it removes another source of fiber from the world market at a time when demand is strong and most of the cotton that has already been harvested has been sold to consumers.
Bill Raffety, an analyst for commodity futures brokerage Penson GHCO, said this puts more pressure on U.S. cotton exportable supplies going forward.
Traders said while U.S. cotton exports are estimated at 15.5 million (480-lb) bales, every single bale will be sold given tight stocks.
The trade will now be looking toward the weekly export sales reports of the U.S. Agriculture Department on Thursday to see if the demand pace has not slackened.
Traders said investment funds are also coming back aggressively into fiber contracts after reducing net long positions in the cotton market.
In its Friday report on cotton futures, CFTC said the net long position of non-commercials fell to 32,043 lots from 39,171 lots net long in the previous report, and managed money accounts' net longs stood at 23,066 lots from 31,402 lots net long.
Raffety and Barbera said it would be interesting to see if those net long positions have risen to reflect the buying by funds in last Friday's rally. The CFTC data showed outstanding positions as of last Tuesday.