Cotton futures have certainly taken a wild rise lately. For example, after settling at 85.29 cents/pound on August 6, December futures had spiked to a 93.72-cent high last Friday (8/16).

It collapsed this week and closed at 84.24 cents/pound yesterday. Thus, it wasnΆt terribly surprising to see it trade in a narrow range today as traders tried to assess its likely direction from this point.

ThatΆs not at all clear, especially with excessive moisture seemingly threatening the Southeast U.S. crop and improved rainfall apparently boosting the potential harvest out of the Southwest. Of course, Chinese actions, or the lack thereof, will almost surely influence the price outlook as well.

However, pragmatic considerations seem likely to overrule all fundamental and technical considerations tomorrow. That is, ICE (International Commodity Exchange) officials announced late this afternoon that they were boosting the margin on cotton contracts traded at the exchange by 25%. That could spark active selling in early Friday action, which in turn could spark a resumption of the breakdown suffered Tuesday and Wednesday.

WeΆll have to wait and see how things play out, but they donΆt seem particularly promising at this juncture.