Cotton was basically unchanged overnight until equity markets opened lower and the USD rallied which eventually lead to more profit taking in commodities. Cotton tested the 80 cent level again after a below average sales report showed that demand certainly is under pressure with the market in the mid 80's. Volume was good and expect demand to improve tonight as we are getting closer to China's price idea for SM 1-1/8" as well as reaching tenderable parity with cert stock.

However, the biggest factor at the moment is the strong USD. We are in an uptrend channel that looks like it will be in tact for a while. Greece is reeling and raising more questions about the long term survival of the Euro. This explains why gold and the Yen also are well supported as this uncertainty is causing a flight to quality. The big dip in stocks today of almost 1,000 points is being blamed on some clerical errors but there is underlying fear that could lead to further downside testing.