Keith Brown DTN Contributing Cotton Analyst    

The cotton market ended its Tuesday's session with all current crop year contracts up to their daily permissible limit. The drivers for such a reaction was the fact the market was extremely oversold, and rumors on various Asian social media platforms suggesting China was going to soon lift its COVID-19 restrictions. Of course, the latter comment is unfounded. Nonetheless, bargain buyers were out and previously short sold traders were quickly covering.    

Wednesday afternoon, the Federal Reserve will formally announce its latest interest rate intentions. Many traders are expecting at least a three-quarters increase, coupled with a dovish afternoon statement. The outcome of its decision will affect the ebb-and-flow of the U.S. dollar.    

Crude oil was higher Tuesday, amid Chinese rumors of a COVID-19 reopening. Additionally, the dwindling oil supplies of the US's Strategic Petroleum Reserve (SPR), and potential reinvigorated energy demands have some traders expecting to see $100 per barrel again.    

For Tuesday, December closed at 75.00 cents, up 3.00 cents, March 2023 finished at 74.64 cents, up 3.00 cents and July 2023 settled at 74.98 cents, 3.00 cents higher; estimated volume was 37,524 contracts.    

Keith Brown can be reached at commodityconsults@gmail.com 

(c) Copyright 2022 DTN, LLC. All rights reserved.