REUTERS: Cotton jumps on strong demand

REUTERS: Cotton jumps on strong demand

NEW YORK: ICE cotton futures rose as much as 4% on Friday to their highest level in more than a month, supported by robust demand and technical buying, with speculators getting back into the market after a sharp fall earlier this week.

The cotton contract for December was up 3.23 cents, or 3.49%, at 95.69 cents per lb by 01:02 p.m. ET (1702 GMT). Prices fell to a 1-1/2 month low on Monday.

The contract is up more than 3.5% so far this week, its biggest weekly percentage gain since mid-June.

“It was really a aggressive rally here that took off earlier this morning when the market kind of broke through some of nearby resistance levels,” said Bailey Thomen, cotton risk management associate at StoneX Group.

Speculators who trade on technical signals regard a break above key moving averages like 50-100-200-day moving average as a bullish sign. Cotton prices are trading above those moving averages. On Thursday, the US Department of Agriculture’s weekly export sales report showed net sales of 345,400 running bales for 2021/2022, were up 21% from the previous week, with increases primarily for China.

Total futures market volume rose by 21,404 to 49,430 lots. Data showed total open interest gained 503 to 263,288 contracts in the previous session. Certificated cotton stocks deliverable as of Sept. 22 totalled 60,107 480-lb bales, down from 60,976 in the previous session.


Source: Reuters
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