By Keith Brown DTN Cotton Correspondent
The cotton market finished Friday on a solid bullish note. As of Thursday, Spot May was net down 0.04 cent for the week, but Friday it closed out 0.64 cent higher than last Friday. Clearly, the fundamentals and technicals are in momentary agreement. Fundamentally, strong sales and exports, fewer intentions and a positive jobs data added to the bullish tone. To that end, those friendly fundamentals were reflected on the charts, as the moving averages, stochastics, the RSI, and other popular trading indicators seem to have all turned bullish.
Next week, the market will view USDA’s monthly supply-demand data on Tuesday. Traders will be looking to see if the government will up the exports category. Of late, the pace of shipments for the current season has been right on the heels of USDA’s target. However, if a trade deal with China happens, the market may expect its pace to equal or even surpass the target of 15.0 million bales.
There is increasing hype that a trade deal between the U.S. and China is imminent. In fact, President Trump indicated on Friday that a trade deal will happen within in the next four weeks. There are those analysts believe much of a trade agreement has already been discounted, nonetheless it would be a huge boon to the cotton trade and the global economy.
For the week, spot May cotton was up 0.64 cent. This is the fourth consecutive weekly gain for the cotton market.
May cotton settled at 78.25 cents, 0.93 cent, July was at 78.59 cents, up 0.58 cent and December closed at 76.89 cents, up 0.60 cent. Friday’s estimated volume was a whopping 58,216 contracts traded.
