Cotton Futures—Cotton futures in the March contract is trading lower for the 2nd consecutive session down 53 points at 70.85 despite the fact that the United States and China will sign their trade agreement this afternoon which I do believe is a very bullish fundamental factor for higher prices in the coming months ahead.
I have been recommending a bullish position from around the 66.60 level and if you took that trade continue to place the stop loss at the 2 week low standing at 68.50, however in tomorrow’s trade that will be raised to 69.05 as the chart structure is outstanding at the current time due to the fact that the volatility is very low.
For the bullish momentum to continue prices have to break the January 13th high of 71.96 in my opinion as I still believe prices could touch the 75 level in the coming weeks ahead as the recent pullback in price is blamed on profit-taking. Cotton prices are trading above their 20 and 100 day moving average as the trend remains to the upside so continue to place the proper stop loss as I might be looking at adding more contracts in tomorrow’s trade due to the fact that the risk/reward is in your favor.
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