NEW YORK, Oct 25 (Reuters) - U.S. cotton futures vaulted
the daily limit on Monday to an all-time high on speculative
fund and investment buying, sparked by a fall in the dollar to
a 15-year low and worries over the damage caused by storms in
the major growing state of Texas, analysts said.

The dollar sank to its lowest level since 1995, hammered by
news the G20 countries agreed to shun competitive currency
devluations, which was taken as a signal for investors to dump
the greenback.

A bullish jolt was also provided by storms from Thursday to
Saturday that raked Texas, which produces about half of the
U.S. cotton crop, and a rally in China, which sparked cotton
values on the ICE Futures U.S. commodity exchange.

The National Weather Service said Lubbock, Texas, in the
heart of the U.S. cotton belt, would be hit by blowing dust on
Monday, with gusts up to 45 miles per hour.
ICE Futures U.S. key December cotton contract gained
for the fourth straight session, rising the 5-cent limit to
trade at a new record of $1.2471 per lb at 9:51 a.m. EDT (1351
GMT). The day's low was $1.205.

'The dollar falling out of bed just added fuel to the
bullish fire,' said Keith Brown, president of commodity firm
Keith Brown and Co in Moultrie, Georgia.

The Zhengzhou Commodity Exchange's benchmark fourth-month
Chinese contract was last traded at a lifetime top of
26,270 yuan per tonne, up 5 percent from Friday.

'The cotton complex has been supported by a continued
barrage of crop downgrades around the world,' said Luke
Matthews, a commodity strategist at the Commonwealth Bank of
Australia.

Traders said the storms in Texas around Lubbock were
particularly ill-timed because the state has not yet completed
its harvest and there could be severe yield and quality losses
there as a result.

'Lubbock is one of the biggest cotton patches in the United
States,' said Lou Barbera, a cotton analyst with commodities
brokerage VIP Commodities.

But Barbera said cash cotton markets were still running
ahead of the levels seen in the futures, so the likelihood was
strong that fiber values may still march higher.

Analysts in China said the price surge in both the physical
and futures markets did not reflect fundamentals.
Prices already have been pushed up too high and there is
still little sign that they have reached their peak, but a big
downward correction could happen at any time, said Shao Qing,
an analyst with Dalu Futures.

The U.S. cotton market's technical signals also showed it
was already heavily overbought.

(Graph of cotton price with 14-day and 9-day RSI readings:
http://graphics.thomsonreuters.com/gfx1/AB_20102510094536.jpg)

Analysts said the only thing that could slow cotton down at
this time would be when investment funds begin to roll their
positions forward out of the spot December contract as it gets
ready for first notice day in deliveries next month.