The cotton market finished sharply higher Monday driven by bullish technicals and its historical seasonal trend. By most measurements, many of the widely-followed chart indicators have turned bullish, which have encouraged previously short-sold speculators into short-covering buyers. Into its February low, we were remembering speculators were nearly record net-short. Thus as those aforementioned indicators consisting of moving averages, stochastics, cycles, and the like are definitely beginning to show the bearish spec the err of his ways.

Additionally, this is the time of year cotton’s seasonal begins to tug prices higher. Typically, last season’s production is becoming exhausted (tighter), which is bullish to the old crop, and there is uncertainty of getting this year’s new crop planted. The latter is considered bullish to the new crop. Of course, if the market were to see fewer intended acres for 2019, plus continuing adverse weather, then the dynamics for the market would be all the more positive.

Lastly, and this may be a reach, with the Mueller report indicating no collusion between the President Trump and the Russians, he should stand with greater political clout with the Chinese, in that he, Mr. Trump, will not be going away any time soon. Thus, the Chinese may have better incentive to do a deal.

As always we will be on the lookout for a Turnaround Tuesday, but seemingly, the cotton market has “changed colors.”

May cotton settled at 77.73 cents, up 1.15 cent, July finished at 78.51 cents, up 0.94 cent, and December closed at 75.73 cent, up 0.43 cent. Monday’s estimated volume was 35,000 contracts.