Cotton Futures—Cotton futures in the December contract settled last Friday in New York at 59.50 while currently trading at 62.60 down slightly this Thursday afternoon breaking a 3 day winning streak, however prices are still hovering right near a 4 month high.
I have been recommending a bullish position from the 62.20 level while placing the stop-loss under the June 23rd low of 58.55 as the risk was around $1,700 per contract plus slippage and commission as a breakout to the upside has occurred in my opinion. The USDA crop report which was released earlier in the week stated that the United States only planted 12.19 million acres as estimates were 13.15 as we should not produce a record crop in 2020 as the fundamental and technical picture for this commodity has turned to the upside coupled with the fact that demand is coming back from China.
Mexico also announced that their production of cotton will be the lowest since 2017 adding more fuel to the fire as the 7/10 weather forecast has higher than normal temperatures coupled with below average rainfall so stay long as there is room to run.
CHART STRUCTURE: SOLID
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