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DTN Morning Cotton Commentary          12/06 08:13

   Cotton Higher, Anticipates Tuesday's Report  

   The cotton market is trying to put on a decent face for a bearish week. 

By Keith Brown
DTN Cotton Correspondent

   The cotton market is trying to put on a decent face for a bearish week. 
Earlier comments from President Trump suggesting the trade deal may have to 
wait until after the 2020 election sent prices down some 200 points, but the 
market has staged a small comeback. Thursday's sales and exports were okay, and 
now the market is anticipating more friendly supply-demand data come next 
Tuesday. Early sentiment suggests a 500,000-bale cut to the U.S. crop may be in 
order.  

   Friday afternoon the CFTC will publish its bi-weekly commitment-of-traders 
report. As they currently stand, managed money speculators are net short some 
5,000 contracts. This number is way off from their summer peak of 49,000 
contracts. With the right dose of bullish fundamentals, such a moderate trade 
deal, or a dynamic adjustments to the supply-demand numbers, they could easily 
sway bullish.

   The Labor Department reported a 'blow-out" jobs number. Expectations were 
calling for an increase of 183,000 non-farms jobs, but the number released was 
266,000 new jobs. The overall unemployment rate remained at its recent 
historical low 3.6%. The Dow Jones and related stock markets jumped higher on 
the news. 

   OPEC and Russia are meeting today to decide on new production cuts. A 
current number being floated to prop up crude prices is a 400,000 barrel per 
day cut. Crude oil prices have rallied this week on those expectations.

   For Friday, December cotton expires at 2 p.m., but support for the March 
stands at 64.00 cents and 63.70 cents, with overhead resistance at 66.00 cents 
and 66.90 cents. Overnight estimated volume is 7,057. 

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


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