Cotton Futures closed sharply higher on reports

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General Comments: Futures closed sharply higher on reports of very hot weather conditions in Chinese production areas that could hurt yields. China buys a lot of US Cotton and might need to buy more if production there is hurt. US crops remain behind the normal pace. The poor planting conditions early in the year have made the crop progress behind normal. Temperatures are warmer again in Texas, and it has turned dry again. Conditions in Alabama, Mississippi, and Missouri are good after some big rains earlier in the growing season and rains in recent days as well. Export sales have been on the weak side lately as the buy side of the market waits for prices to work lower. World production ideas are also high. Weather for Cotton still appears good in India.

Overnight News: The Delta and Southeast will see mostly dry weather today and tomorrow and showers this weekend. Temperatures will average near to above normal. Texas will see dry weather this week and maybe a shower in the north. Temperatures will average above normal. The USDA spot price is now 84.45 ct/lb. ICE said that certified Cotton stocks are now 0.062 million bales, from 0.070 million yesterday. USDA said that net Upland Cotton export sales were 81,400 bales this year and 0 bales next year. Net Pima sales were 14,700 bales this year and 0 bales next year. USDA noted that the crop marketing year has now changed.

Chart Trends: Trends in Cotton are up with objectives of 89.60 and 92.80 October. Support is at 87.80, 87.45, and 87.00 October, with resistance of 89.65, 90.10, and 90.70 October.

Source: futuresmag.com

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