May 19 (Reuters) -ICE cotton futures hit a more than three-month peak on Friday and were set for their best week since late November, bolstered by the dollar's pullback and a technical breakout.

* The most active first-month July cotton contract CTc1 fell 0.72 cent, or 0.8%, to 87.38 cents per lb by 11:24 a.m. EDT (1524 GMT). It traded in a range of 86.13 to 87.98 cents a lb.

* The contract gained 8.4% so far this week.

* Bailey Thomen, cotton risk management associate at StoneX Group, attributed part of the gains to a break above technical resistance around the 87-cent mark. However, she noted that prices were now approaching "overbought" levels.

* "A lot of spread trading activity is especially pushing it higher with the July and December contracts being rolled aggressively... We are seeing a good influx of business coming in from growers who are fixing their prices now at these levels."

* A lower dollar also made greenback-priced cotton more attractive, especially for overseas buyers. USD/

* Also helping the natural fiber by making substitute material polyester more expensive were gains in oil markets. O/R

* Chicago corn and soybeans also rose in a technical rebound from multi-month lows a day earlier GRA/

Reporting by Rahul Paswan in Bengaluru; Editing by Devika Syamnath