Officials with the China Cotton Association made several announcement and statements Wednesday night, but failed to significantly affect the broader market. They probably damaged their credibility when they estimated 2013 Chinese cotton production at 29 million bales, whereas the USDA boosted its estimate of the Chinese crop from 32 to 33 million on its January 10 WASDE report.

Otherwise there seemed to be little news that might have affected the ICE market. Traders are watching shifts in certificated stocks quite closely, especially after the exchange adjusted its rules at the start of the year.

One could argue that todayΆs big equity market drop played a role in the late cotton decline, but others could just as easily contend that technical considerations were more important. As pointed out yesterday, the nearby March contract seemed to post a ‘hanging manΆ candlestick reversal signal Wednesday, thereby presaging a short-term technically-driven decline.

It seemed as if the market would avoid that through much of the session, but the late decline appeared to confirm the bearish signal. I still have doubts about bearsΆ ability to force a test of chart support around the 85.00-cent level (basis March), especially with its 10-day moving average having risen to 85.37 cents/pound today. A test of that support now seems more likely, but certainly isnΆt guaranteed either.