Home / Knowledge / News / Textiles / Profit taking leads to plunge in cotton prices
Profit taking leads to plunge in cotton prices
05
Aug '08
Commodity prices plunge lower as cotton gets pulled along for the ride. We hit the lowest level for Z'08 in almost a year today and we may be setting up for the first real short position attempted by the specs since May'07 (see page 2 in attached PDF). We are certainly seeing profit taking coming from the commodity sector for the first time in quite a while.

We do have a .9% long position in cotton today compared to .7% last week, but open interest went up on Friday over 2,000 contracts which signal that new shorts entered the market during the heavy selling. Volume was much better today with 25,000 futures and 20,000 options as we are starting to see weakness lead by grains but being followed through by new spec selling.

Commodity hedge funds have been rewarded for holding long positions for over 6 years now, but July '08 was the worst loss for commodity hedge funds in 35 years.

Crude oil which fell another 4 dollars today. We are feeling concern by commodity funds which could translate into further losses during August as we await the USDA report next week on the 12th. Demand from mills will pick up with the spot month near 67 cents as that translates into prices landed the Far East near 75 cents.

MACD crossed lower today in cotton and and we broke heavy support at the 70 cents level. RSI is in the 30's and we are getting into oversold territory. Have to see how the grains respond tonight, but there were rumors that one large commodity hedge fund was forced to liquidate some positions today and that seemed like a good reason to explain such a heavy sell off across the board. The commodity index has been sliding since the beginning of July (see monthly chart on page 3 in attached PDF).

We may be seeing the first pull back since this rally began back in 2002 when the USD also started its collapse. If this trend is starting to change, all commodities are due for more of a correction.

Click here to view more:

ECOM USA Inc

Must ReadView All

Courtesy: H&M

Apparel/Garments | On 30th Mar 2017

H&M group's sales increase 7% in 3 months to Feb '17

The H&M group's sales including VAT amounted to SEK 54,369 million...

Textiles | On 30th Mar 2017

India Inc should work for July 1 GST roll out: Fin sec

The Goods and Services Tax (GST) will take India into a very exciting ...

Textiles | On 30th Mar 2017

Azerbaijan cotton industry created 64,000 jobs last year

Cotton industry in Azerbaijan created 64,000 jobs in 2016, and a...

Interviews View All

Janak Dhamanwala & Sunil Dhamanwala
Jansun

Moving towards sustainability is also a social change

Veronique Lee
Modavanti

‘Sustainable fashion is trending upwards, slowly but surely, as people...

C. Dhandayuthapani
Mag Solvics Pvt. Ltd

ITME 2016 exploited our full strength like never before

Mohammad Hassan
Biax Fiberfilm

About one in every 20 patients picks up an infection while hospitalised....

Larry L Kinn
Suominen Corporation

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

Urs Stalder
Sanitized AG

Urs Stalder, CEO, Sanitized AG, talks about the increasing use of hygiene...

Jay Ramrakhiani
Occasions Elegance Wear

It is believed that by early 19th century, Varanasi weavers had moved away ...

Robert Brunner
Devereux

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

Karan Arora
Karan Arora

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

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
March 2017

March 2017

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

SUBSCRIBE


Browse Our Archives

GO


eNEWS
Insights
Subscribe today and get the latest News update in your mail box.
Advanced Search