July 1 (Reuters) -Cotton edged up on Monday as traders covered short positions ahead of the Independence Day holiday, while an upbeat sentiment in oil also helped.

* Cotton contracts for December CTZ4 rose 0.15 cents, or 0.2%, to 72.84 cents per lb at 1218 p.m. EDT (1618 GMT).

* Traders are covering shorts ahead of the holiday week, "so I feel the market will try to regain its composure, and then look out to the weather situation into next week," said Keith Brown, principal at cotton broker Keith Brown and Co in Georgia.

* Oil prices rose on Monday, helped by expected peak summer consumption and OPEC+ production cuts, making cotton-substitute polyester more expensive.

* Cotton speculators decreased their net short position by 4,849 contracts to 46,593 in the week to June 25. CFTC/

* "We need to close above 73.50 (cents), that would sort of help the market psychologically and technically," Brown added.

* The dollar .DXY hit a near one-week low earlier in the session, making cotton cheaper for other currency holders, before edging up about 0.1% as of 1535 GMT. USD/

* Cotton futures fell over 2% on Friday after the annual acreage report from the USDA estimated a 14% increase in total cotton planted area for 2024, reaching an estimated 11.7 million acres.

Reporting by Anmol Choubey and Rahul Paswan in Bengaluru; Editing by Maju Samuel