By Keith Brown DTN Cotton Correspondent

The cotton market ended the first day of December’s new trading month moderately lower. There were some weekend headwinds stemming from China’s retaliation over the Hong Kong rights bill passed by the U.S. Congress and signed by President Trump.

China has restricted all U.S. Naval ships from entering Hong Kong harbor, target certain non-governmental U.S. companies for doing business with Hong Kong. Moreover, the Chinese now insist all U.S. tariffs be lifted before any progress on the U.S.-China trade deal will be allowed the go forward.

The U.S. stock markets sold off Monday as the stalled China talks, as well as profit-taking hit all the major indexes.

Monday afternoon, USDA will report on the pace of the 2019 harvest. As of last Monday, the 2019 Harvest was 78% complete. Monday’s expectation call for the harvest to be at least about 85% done.

Technically, March cotton is already threatening its low of last week, which was 64.75 cents. A close under that level would send an obvious negative chart signal to hedgers and speculators alike. Of late, managed money funds have been ramping up their already net short position. Such bearish action will only encourage them to tack on more positions.

Spot December cotton saw 10 delivery notices Monday. So far, there have been close to 750 notices issued. However, thus far all have been stopped by a strong commercial.

Monday March cotton settled at 64.80 cents, down 0.56 cent, July ended at 66.86 cents, down 0.16 cent and December 2020 closed at 67.33 cents, up 0.49 cent. Monday’s estimated volume 35,539 contracts, with a third of that increase coming in the waning minutes of Monday’s trade.