DTN Morning Cotton Commentary          04/19 07:51

   Cotton Senses a Recovery  

   After being bearishly blasted all week, the cotton market would like to 
finish positive Friday. 

Keith Brown
DTN Contributing Cotton Analyst

   After being bearishly blasted all week, the cotton market would like to 
finish positive Friday. Given all the exhaustion of the speculators and 
growers, this could happen, and prices stand as oversold now as they did during 
the depths of harvest. In addition, the overnight escalation occurring in the 
Middle East has all traders on edge.

   Friday at 3:30 p.m. EDT, the CFTC will update its Commitments of Traders 
data. Last week saw net sales of 18,000-plus contracts by the managed-money 
funds. The result was a reduction in their net-long position to 62,000 
contracts. At their 2024 zeal, they were net long some 100,000 contracts.

   Spot May will enter its delivery period next week on April 24. Coming into 
Friday's trade, the open interest for the May contract stands at 19,200. In 
addition, ICE exchange stocks have reached 166,190 bales, which is the highest 
they have been since June 2021.

   Cumulative sales had reached 95% of USDA's forecast for the current 
marketing year versus a five-year average of 101% for this point in previous 
marketing seasons. The ICE exchange stocks were up 2,270 bales on Tuesday to 
171,700. This was the highest they had been since July 5, 2017. Stocks have 
increased every day since March 6.

   The current U.S. Drought Monitor shows approximately 9% of the U.S. cotton 
area is experiencing drought. That level is from 11% the previous week, 40% a 
year ago and 55% two years ago.

   For Friday, chart support for July cotton stands at 79.50 cents and 79.00, 
with 81.90 and 83.80 as resistance. Friday morning's estimated volume stands at 
9,234 contracts. 

   Keith Brown can be reached at commodityconsults@gmail.comor by calling (229) 
890-7780.




(c) Copyright 2024 DTN, LLC. All rights reserved.