The stronger dollar continued to hang around and commodities traded mixed Wednesday. Gold hit a new contract high today as the currency instability in Europe continues. Equities had a good performance amid positive feelings of an improving economy and Dow Jones industrial average climbed back to the level a week ago before the near 1,000 point drop. Cotton traded steadily higher in the early morning and peaked around 82.50 on July contract on strength of the equities market. But stronger dollar pulled the market back and the spot month closed with a minor loss on the day.

As we keep failing to breakthrough the resistance at the top of the range, we may see some more spec liquidation down the road. However, mill demand is under the market and will certainly be supportive on dips. Spread trading has been active during today’s session. With July settling 16 points lower and December settling 99 points higher, the spread between the
two months went to 300 points with specs exiting their July positions and buying on the December instead.