A bad day for cotton futures. Weekly export sales were up 4% from a week ago, but unchanged from the 4-week average. Sales year to date total 81% of USDAΆs current forecast, vs. a 5-year average of 84% by this time. But we donΆt see USDA cutting the export forecast yet. Just last year sales year to date were only 78% of the forecast at that time and it was still met.

Futures are still clearly in an uptrend, but have been having trouble clearing overhead resistance and forming what could be viewed as a potential “distribution top”. TodayΆs action only reinforces that view.

China threw the market another curve this week, this time a supportive one. Just a week after announcing they would unload 3 million tonnes (30%) of their huge reserve stocks, they announced they would be buying more than 4 million tonnes of new crop from producers to support domestic prices and raise reserves even higher.