* Market at lowest level since mid-February 2010
NEW YORK, May 17 (Reuters) – Cotton futures settled on Thursday at a 2-1/4-year low on speculative sales as bumper supplies and a shaky global economy kept market bears firmly in control, analysts said.
July cotton on the ICE Futures U.S. exchange slipped 0.32 cent to finish at 76.65 cents per lb, trading from 76.26 to 78.23 cents. It was the lowest close for the spot cotton contract since February 2010, Thomson Reuters data showed.
The combination of a large cotton crop in the United States and elsewhere, a strong dollar, economic weakness and the euro zone debt crisis kept cotton under pressure.
“The bears are fully in control of this thing,” said independent cotton analyst Mike Stevens in Mandeville, Louisiana. “You have to follow the trend and the trend is down.”
Cotton futures are technically oversold, with a 14-day relative strength index reading of 23. A level of 30 or below normally means a market is oversold and one of 70 or higher means it is overbought.
New-crop December fell 0.71 cent to end at 73.90 cents, dealing from 73.78 to 75.60 cents.
Fundamentally, the trade saw export sales as robust.
The U.S. Agriculture Department’s weekly export sales data showed U.S. net upland cotton sales at 178,600 running bales (RBs, 500 lbs each), with the buying led by top consumer China at 76,000 RBs.
“The sales were good but it did not seem to matter to the market,” a dealer said.
Cotton is trading at levels last seen before a historic rally that began in August 2010. That surge lifted prices to a record at $2.27 per lb, topping even what cotton fetched during the U.S. Civil War in the 19th century.
Volume on Thursday reached slightly over 17,100 lots, almost a third under the 30-day norm, Thomson Reuters data showed.
Open interest hit 189,132 lots as of May 16, up for the third session in a row, ICE Futures U.S. data showed.
(Reporting by Rene Pastor; Editing by Dale Hudson)