Cotton Moves Lower Friday

After its tumultuous bearish trade Thursday, the cotton market is suffering additional follow-through Friday morning. Thursday, poor export sales, a strong U.S. dollar, and harsh comments from President Trump on likely Chinese interference in the 2020 U.S. presidential election are causing some traders to rethink their positions.

Friday at 3:30 p.m. EDT, the CFTC will update its Commitments of Traders information. Last week saw the managed-money funds had net-bought some 7,100 positions, further enhancing their net-long carry to 39,106 contracts.

On Monday, China will supposedly auction bales from her state reserves. This move is being done to rotate certain seasonal storage and to feed her own textile mills.  

Also on Monday, USDA will update the condition of the 2026 crop. Of late, the good-to-excellent readings have been slipping. The highest point was 54%, but last week it was 44% for the national crop.

The 6- to 10-day weather forecast (July 22-26) shows above-normal temperatures for Texas, the southern Delta and the Southeast. Rainwise, Texas looks to have below-normal odds, the Delta should have normal chances, and the southeast slightly above-normal opportunities.

Chart support for December cotton stands at 77.75 cents and 76.45 cents, with resistance around 79.30 cents and 79.85 cents. Friday morning’s estimated volume is 15,210 contracts.

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