DTN Morning Cotton Commentary          04/24 07:13

   Cotton Folds on Friday 

   The cotton market is somewhat lower Friday as traders are seeking to either 
square or flatten certain positions. 

Keith Brown
DTN Contributing Cotton Analyst

   The cotton market is somewhat lower Friday as traders are seeking to either 
square or flatten certain positions. The ICE futures have been on a wild, 
upside tear for nearly seven weeks, without any sort of correction. Thus, 
today's Friday retreat seems to be a normal response. Still, traders will 
assess the CFTC's update, May cotton's delivery, weather forecasts, and the 
geopolitical situation unfolding in the Middle East.

   First notice day for the May contract is Friday, with any notice being 
issued post close. Its delivery period runs through May 6.

   Also, Friday at 3:30 p.m. EDT, the CFTC will update its Commitments of 
Traders standings. Last week, for the first time in some two years, the 
managed-money funds had reversed to a net-long position. Currently, they are 
net-long some 16,000 contracts.

   The Climate Prediction Center has upped its drought reading for the U.S. 
Cotton Belt from 97% to 98%. Clearly, U.S. cotton growers are facing a massive 
generational drought of Biblical portions. With that, the 6- to 10-day map 
(April 29 to May 3) shows below-normal temperatures for Texas, somewhat normal 
readings for the U.S. Delta, but above-normal for the Southeast. Rainwise, 
Texas looks to have normal to slightly above normal odds, the Delta and the 
Southeast with slight changes, with specifically greater opportunities for 
Georgia.  

   Chart support for July cotton stands at 78.45 cents and 77.55 cents, with 
resistance around 81.10 cents and 82.00 cents. Friday morning's estimated 
volume is 11,310 contracts.

    

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




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