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DTN Closing Cotton 12/06 13:53
Cotton Surges, Then Retreats
The cotton market staged a strong rally Friday on bullish anticipation of a
U.S.-China trade deal and a friendly USDA supply/demand report of next Tuesday.
By Keith Brown
DTN Cotton Correspondent
The cotton market staged a strong rally Friday on bullish anticipation of a
U.S.-China trade deal and a friendly USDA supply/demand report of next Tuesday.
Then, late in the session, profit-taking hit the trade and pulled the market
off, but into the close prices shored up. However, it was cotton's best day in
many weeks.
The China trade situation received a "bump" of sorts as several news wires
reported China was going to lift tariffs on certain amounts U.S. soybeans and
pork. Naturally, that announcement increased optimism about an overall trade
deal.
Also helping cotton rally was the stout jobs report. New non-farm jobs
turned out to be nearly double the expectations analysts had published.
Additionally, the Labor Department revised higher the previous jobs report of
the last three months.
Spot December cotton expired Friday at 65.00 cents, which was seen as a
decent technical close. That is, at one time December was trading discount to
the March by some 2.00 cents. Now that spread narrowed to exactly 1.00 cent.
Additionally, March cotton finished week-over-week some 0.64 cent higher. That
too was a friendly technical move, given on Wednesday morning, it was down 2.00
cents on the week.
As a reminder this Monday will be another round of harvest data, and on
Tuesday, USDA will release its latest crop data.
For Friday, March cotton settled 66.00 cents, up 1.49 cents, July closed at
67.51 cents, up 1.03 cents and December 2020 ended at 67.64 cents, up 0.53
cent. Estimated volume was 35,803 contracts.
Keith Brown can be reached at commodityconsults@gmail.com or by calling
(229) 890-7780.
(BE)
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