Home / Knowledge / News / Textiles / NY cotton futures move sideways this week
NY cotton futures move sideways this week
04
Aug '12
Plexus Cotton Limited reported that New York (NY) futures moved sideways this week, as December posted a small loss of 42 points to close at 70.97 cents.

Over the last 25 sessions, dating back to June 28, the December contract has settled no lower than 69.51 cents and no higher than 72.94 cents, giving us a boring trading range of just 343 points, which signals that neither the bulls nor the bears are currently in control of the market. 

When we look at December’s chart over the last two-and-a-half months, we notice that this contracting price range has been forming a triangle pattern, in this case a symmetrical triangle, marked by lower highs and higher lows.

Since the trendlines in a triangle are converging, it is just a matter of time until the market finally breaks out to either side. Although triangles are sometimes reversing a trend, they are typically seen as continuation patterns, meaning that the breakout usually occurs in the direction of the prevailing trend, which is currently down.

More specifically, a break below 70 cents in December would violate this triangle pattern to the downside and probably lead to a retest of support in the mid-60s, while a move above 73 cents would signal a reversal to the upside and likely invite a decent amount of new spec buying.

From a fundamental point of view there seems to be plenty of support for US cotton at the moment. Today’s US export sales report was surprisingly strong considering how quiet the market has been lately. For the week ending July 26, net sales of Upland and Pima amounted to 221’800 running bales, of which 39’700 running bales were for prompt shipment.

Once again there were 19 markets participating in the buying last week, which shows that there is broad-based support of US cotton at current levels. Shipments were constructive as well at 310’500 running bales, bringing total exports for the 2011/12-season to 11.65 million statistical bales, with five days to go in the marketing year. This means that US exports will surpass the current USDA estimate of 11.6 million bales by some 200’000 bales, thereby lowering beginning stocks to around 3.1 million bales.

As we alluded to last week, it seems that the US supply situation will remain extremely tight until new crop starts moving in. With around 4.4 million bales in export commitments, most of which are for nearby shipment, and with another 0.9 million bales needed for domestic mill use over the next three months, some shippers may have difficulty in finding cotton for their commitments.

Maybe merchants became too cautious in securing supplies when prices were falling and sales contracts were non-performing, and are now finding themselves with some holes to fill. It looks as if the certified stock might be used for this purpose, as it has dropped by 96’041 bales since July 10, amounting to just 36’049 bales as of this morning.

For the futures market this tightness in the cash market is relatively inconsequential, since October has hardly any open interest (just 358 contracts) and December should have plenty of new crop available by the time its delivery period rolls around.


Must ReadView All

Sri Lanka’s apparel exports rise after EU GSP+ reinstatement

Apparel/Garments | On 18th Nov 2017

Sri Lanka’s apparel exports rise after EU GSP+ reinstatement

Sri Lanka’s apparel exports from January to September 2017 has...

Bangladesh plans 2 leather estates in Rajshahi, Chittagong

Apparel/Garments | On 18th Nov 2017

Bangladesh plans 2 leather estates in Rajshahi, Chittagong

Bangladesh Prime Minister Sheikh Hasina has said two more leather...

ASEAN, Hong Kong sign free trade agreement

Textiles | On 18th Nov 2017

ASEAN, Hong Kong sign free trade agreement

The Association of Southeast Asian Nations (ASEAN) and Hong Kong...

Interviews View All

Rahuul Jashnani
Jashn

‘Online economy has changed the whole dynamics of buying habits.’

Sonia Agarwal
Whitenife

‘The terms eco-friendly and organic are common but everyone perceives them ...

Manfred Mentges
Sedo Treepoint GmbH

We see a higher demand in colour management systems, as customers see big...

C Dhandayuthapani

MAG Solvics Private Limited was established in 1991 to design and develop...

Harmeet Singh

New Delhi-based Jogindra Industries Private Limited provides an assortment ...

Abhishek Pachauri

Reckon Industries adapts latest systems for manufacturing from designing...

Eamonn Tighe
Nature Works LLC

Eamonn Tighe, Fibres and Nonwovens - Business Development Manager of...

Ashok Desai
Bombay Textile Research Association

Bombay Textile Research Association (BTRA) is a leading name in textile...

Marten Alkhagen
Swerea IVF AB

Marten Alkhagen, Senior Scientist - Nonwoven and Technical Textiles of...

Robert Brunner
Devereux

Golfwear and menswear brand Devereux is set for greener pastures. Robert...

Divvya and Nidhhi Gambhir
Walnut

<b>Divvya and Nidhhi Gambhir</b> started their career with the launch of...

Judy Frater
Somaiya Kala Vidya

Among the many honours showered on Frater, including Fulbright and Ford...

Press Release

Press Release

Letter to Editor

Letter to Editor

RSS Feed

RSS Feed

Submit your press release on


editorial@fibre2fashion.com

Letter To Editor






(Max. 8000 char.)

Search Companies





SEARCH

November 2017

Subscribe today and get the latest update on Textiles, Fashion, Apparel and so on.

news category


Related Categories:

Planning to Take the Leap towards
Sustainability?

Do you see sustainability as a route to business growth?

Yes No

Do you think the sustainability space has the needed tools and resources available for a business to lead change?

Yes No

Active Poll

Do you see sustainability as a route to business growth?

Yes
68.5%
No
12.4%
Skip
19.1%

Total Votes: 89

Do you think adopting a sustainable approach will be a profitable move for your business?

Yes No

Active Poll

Do you think the sustainability space has the needed tools and resources available for a business to lead change?

Yes
61.8%
No
30.3%
Skip
7.9%

Total Votes: 89

Do you want the world to know about your sustainability journey and your business’ environmental footprint?

Yes No

Active Poll

Do you think adopting a sustainable approach will be a profitable move for your business?

Yes
86.5%
No
10.1%
Skip
3.4%

Total Votes: 89

Thanks for your valuable feedback. Claim your free latest sustainability e-book.

Active Poll

Do you want the world to know about your sustainability journey and your business’ environmental footprint?

Yes
80.9%
No
9.0%
Skip
10.1%

Total Votes: 89


E-News Insight
Subscribe Today and Get the
Latest News Update in Your Mail Box.
Advanced Search