Follow through buying came in the market Monday morning and ICE cotton futures traded to an intraday high at 81.27 basis May contract. As the general commodity market slipped off on a stronger dollar, cotton lost all of the gains on the day and posted a minor loss. However, support was found around 80 cent, and any loss below that area was quickly recovered. The final settlement was a 30 point gain on the front months.

As shown by the charts on page two of this report, total open interest in futures remained stable during the past week. For the week ending Friday March 12th, specs slightly reduced their net longs in cotton from 15.1% to 14.8%. Fundamentally we are expecting gaps between supply and demand and hand to mouth buying from mills is supporting the market. Cert stocks are now well over 700k including waiting review. Technically we could be range bound trading. A close above 81.45 is bullish while a close below 80 cents could push cotton to drift lower from here.