* Second-month prices rise above near-term moving averages
* Exchange inventories slip again to January lows
* 2014/15 weekly export sales drop to lowest since June -USDA data
NEW YORK, Aug 21 (Reuters) - Cotton futures notched a slight gain on Thursday as technical strength and dry weather in Texas buoyed.
The benchmark December cotton contract on ICE Futures U.S. closed up 0.11 cent, or 0.2 percent, at 65.92 cents a lb.
A sharp rally during the previous day has provided a selling opportunity for some producers, offseting investor buying.
Traders pointed to a turn in technical signals behind this week's renewed buying. Prices soared and closed above near-term moving averages on Wednesday.
"Technically, we've created this bottom," said Ron Lawson, a partner at commodity investment firm Logic Advisors in California. "Things are evolving."
The second-month contract has tumbled some 30 percent from a March peak near 97 cents a lb as expectations have risen that U.S. farmers will harvest a bumper crop as demand in top consumer China drops dramatically due to a government policy overhaul during the 2014/15 crop year that began on Aug. 1.
An increase in plantings and much-needed Texas rains earlier in the growing season have boosted expectations that production will hit a four-year high in the United States, the world's top exporter.
But the return of dry weather in Texas this month added support as it has renewed worries over the crop in the top-producing state.
Even so, futures were under pressure on Thursday after a weekly U.S. government report showed sales were again down. Foreign buyers bought 155,600 bales in the ended Aug. 14.
That was the lowest of sales booked against the 2014/15 crop since late June, according to a Reuters review of U.S. Agriculture Department (USDA) data.
ICE stocks continued their slide to the lowest levels since late January. Exchange inventories slipped to 86,550 bales on Wednesday, from 86,690 bales previously, the most recent ICE data showed. (Reporting by Chris Prentice; Editing by Marguerita Choy)
