DTN Morning Cotton Commentary          03/16 07:23

   Cotton Finally Awakens 

   The cotton market is triple-digits higher Monday morning as traders are 
preparing for the upcoming Trump/Xi trade meeting. 

Keith Brown
DTN Contributing Cotton Analyst

   The cotton market is triple-digits higher Monday morning as traders are 
preparing for the upcoming Trump/Xi trade meeting. There is likely some advance 
net buying, but also short-covering, from the massive bearish position of the 
speculative funds. In addition, the U.S. dollar is lower.

   Last Friday, the CFTC issued updated Commitments of Traders data. That tally 
showed speculative funds had bought-in nearly 6,200 contracts, reducing their 
net-short position to 66,764. Their record bearish carry stands at 81,345 
contracts.

   The Climate Prediction Center revealed 88% of the U.S. cotton planted area 
is suffering some form of drought. The current 6- to 10-day outlook has below- 
to much-below chances for rain for the entirety of the Cotton Belt, as well as 
above- to much-above temperatures.

   This week, traders will see various economic reports and events, including 
retail sales, housing starts, the meeting of the Federal Reserve, and weekly 
export sales.

   Crude oil is higher Monday morning as the Trump administration ramps up 
pressure on allies to help safeguard the Strait of Hormuz. Both global 
contracts, Brent and WTI, have surged more than 50% over the past month, 
reaching their highest levels since 2022, as shipping traffic through the 
Strait of Hormuz has been severely disrupted.

   Chart support for July cotton stands at 68.30 cents and 67.85 cents, with 
resistance around 69.55 cents and 70.00 cents. Monday morning's estimated 
volume is 39,278 contracts.

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




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