Good export number continues as per this morning’s USDA report. Sales were 109k bales for the current crop and 246k for the 10/11 marketing year. China is the biggest buyer as well as the biggest receiver of the export shipments. Support at 73 cents on December NY futures is still holding, and physical demand was active on the price dip. Good amount of sales were made overnight, which helped market to rebound on merchants lifting hedges. However, market took a turn to the downside during the day and briefly traded beneath yesterday’s new 20 week low.

The technical outlook on cotton futures is still negative. The most actively traded December contract has dropped over six cents since mid June. The market has run into congestion in the near term, but hit a new low today since the end of February this year. Any rebound today was limited and capped under yesterday’s range high. The market is likely to continue the tight range in the near future, but is vulnerable to a larger sell off.