The invert has become the main feature of the cotton market nearby as we reached as much as 247 points today Z over. In the short term the top of the invert is hard to determine, but the technicals are turning friendly and we could see the Z'10 test the 78 level which is the top of the current range. Volume was above average and the open interest is rising with cert stocks stable at 50k.

4th quarter demand is slowing down as most mills are covered but the momentum is still higher and specs may start to come to the party. The invert is friendly, low cert stocks and the remaining 2 weeks before the south Texas crop starts to be ginned in volume have the short term looking friendly. This will add to the potential for a higher invert Z/H'11 as we wait for the new crop to come on line.