NEW YORK (Dow Jones)--Cotton prices fell again Wednesday as a bearish trend
triggered a cascade of sales.

Nearby cotton for July delivery was 0.67 cent, or 1%, lower at 78.40 cent a
pound on ICE Futures U.S.

Cotton prices have lost 4% in the last week. Without fresh fundamental
momentum, July futures have seen a bearish break lower from the largely
sideways trend it occupied for the last three months.

"Today you saw technical selling based on yesterday's breaking of support
in 79.25-79.50 area [basis July]," said Andy Ryan, risk management consultant
at FCStone in Nashville.

Speculators, who have no use for the underlying commodity, sold to avoid more
losses indicated by the bearish trend. However, firm merchant and mill buying
is minimizing the downward trend, Ryan said.

July futures have firm support at the 78-cent level, he said. Ryan expects
the contract to drift lower through next week as index funds move out of the
July contract ahead of the delivery period, which begins June 24.

Despite Wednesday's losses, ICE cotton futures are still 33% higher than the
same time last year as rebounding world cotton demand eats into available
supplies. As the end of the August-through-July marketing year approaches,
traders are looking to next year's production scenario, which could limit gains
as a bumper crop is anticipated from the U.S.

The fresh supply of cotton is 79% planted in the U.S. and 63% of it was rated
in good-to-excellent condition in the week to May 30, U.S. Department of
Agriculture data show.

Ahead of the fall harvest that will bring new fiber to the market, traders
are keeping a close watch on bountiful exchange stocks and weekly sales and
shipments to gauge ongoing demand.

ICE daily cotton stocks decreased by 1,473 500-pound bales Tuesday to total
1.071 million with 34,293 bales awaiting review and 2,615 decertification
orders, according to exchange data.

ICE cotton open interest--the number of active positions left at the end of
the session--decreased by 4,441 positions Tuesday to total 185,460, according
to the exchange.

Volume was estimated 30,048 lots. In options, approximately 4,415 calls and
4,753 puts traded, according to exchange data.

Close Change Range
Jly 78.40 -0.67 78.32-79.48
Oct 76.33 -0.79 76.11-77.00
Dec 76.65 -0.96 76.25-77.70