Home / Knowledge / News / Textiles / Strong bounce in commodities
Strong bounce in commodities
06
Jun '08
Cotton found good support overnight as we broke out of the range set on Tuesday, but were unable to hold the gains on the close. We started the day with firm grain prices overnight and a good export sales report showing above average sales with 570k and 270k in shipments (See page 2 in attached PDF).

This was not enough to give cotton a chance to hold the bounce set earlier in the trading session as the buying support from funds has not materialized. Seeing the grains showing their best performance in several weeks would normally have spilled over into cotton but that was not the case. Volume was good with 27,000 futures and 12,000 options as volatility and open interest continue to creep higher.

The fact that cotton cannot break the upside selling resistance is hard to understand after watching an unprecedented move across the markets as they all moved higher in tandem. Stocks and commodities all rose significantly as oil lead the way with a strong rally on the close. Even the dollar held up as cotton continues to trade sideways to lower in an attempt to form a bottom.

We have had a significant number of bearish options recently and the specs tend to be sellers on any rally so the upside potential seems limited short term. The U.S. crop is in line with the 5-year average as we are making the transition from 07/08 fundamentals to the 08/09 harvest projections.

Technically, the MACD is still bearish but the RSI is reaching oversold levelsat 25. The next support lies at 62.90, which was the low created on August 27 last year. Specs and index funds are adding to shorts and we may see the spec position cross into negative territory for the first time in over a year next week.

As demand remains hand to mouth and the trade are more vulnerable after the market spike in March, we may see more bearish options that could trigger new spec sell stops. The technicals are still negative but with such a strong bounce in commodities across the board today, the low established this week may hold up in the short term.

Click here to view more:

ECOM USA Inc


Must ReadView All

Courtesy: Fancycrave.com from Pexels

Apparel/Garments | On 22nd Jun 2018

EU's retaliatory duty on US apparel takes effect

As part of the three-pronged response outlined by the European...

NCC applauds House passage of farm legislation

Textiles | On 22nd Jun 2018

NCC applauds House passage of farm legislation

The National Cotton Council (NCC) of the US has welcomed the passage...

Courtesy: Roman Pohorecki from Pexels

Apparel/Garments | On 22nd Jun 2018

UK launches inquiry on sustainability of fashion industry

The Environmental Audit Committee of the UK Parliament has launched...

Interviews View All

Headhonchos
Indian fashion industry

Organic the first choice of any environment-conscious person

Abhishek Ganguly
Puma India

‘As a brand, Puma is always looking for new and innovative ways to inspire ...

Yash Maniyar
Rekha Maniyar

Indian fashion market is growing at a staggering rate

Sugandha Bhardwaj

<div>New Delhi-based Brinjal Designs Pvt Ltd manufactures home furnishing...

Karan Behal

Karan Behal, founder and chief executive of top-selling brand...

Hardik Sanghvi

Idealin Fogging Systems has been engaged in designing and manufacturing...

Marcel Alberts
Eurofibers

Coating at a fibre level is a practice not usually seen in the...

Larry L Kinn
Suominen Corporation

Larry L Kinn, Senior Vice President - Operations Americas of Suominen...

Giorgio Mantovani
Corman S.p.A

Giorgio Mantovani, MD of Corman, with a presence in both Milano and New...

Karan Arora
Karan Arora

Bridal couture created with rich Indian heritage, exquisite craftsmanship...

Sonam & Paras Modi
SVA

Sonam and Paras Modi's Sva Couture is synonymous with head-turning...

Anisha Chaudhari
Threads & Shirts

Threads &amp; Shirts is a freshly-tailored concept providing men/women a...

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

Leave your Comments


June 2018

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

news category


Related Categories:

Advanced Search