Market gave back some profits today but still closed up on the week as we have maintained a rough range between 50/51 in N'07 and 56/57 Z'07. We are seeing quite a bit of trade scale up selling in this area which represents 1100 pts spread from an AWP of 40.12.
There might have been some profit taking going into the weekend as Georgia had some heavy precipitation in the forecast for this afternoon as we attached the radar for the South East attached in PDF Format.
As of late this afternoon we may start to get some relief in the growing region in Central southern Georgia with a storm that hit Florida today and is moving North.
Also included some comments from our Lubbock office on the early crop conditions in Texas. Volume was back to average today with 16,000 estimated futures and 7,000 options.
Export sales came out today with numbers that we were expecting that were very close to last week @ 315K sales and 340K shipments. We also got the breakdown for the loan cotton for upland only shows roughly 900k in Form G and 1.6mb's in Form A (producer).
With the A index officially 400 pts higher as of today from the low 2 weeks ago of 40.12, we don't see this 2.5 million bales moving anytime soon especially with N'07 only showing a 600 pt spread. For the meantime, we will monitor the weather conditions across the U.S. as we move closer to expiration of N'07 and the end of the 06/07 crop season.
Technically, this week has beena solid performance for the bulls as we broke the 50 day MA in Z'07. Notice the strong upward trend in the Z'07 chart attached. RSI at 58.35 is starting to get in oversold territory as Z'07 is becoming the lead month as the spreading continued heavily today between 560/580.
The next target for the bulls will be this week high at 57.00 and the bears will try to break the downside support at 56.00 which represents today's low and the 50 day moving average. Z'07 looks healthy, but N'07 may be an anchor.
.jpg?tr=w-120,h-60,c-at_max,cm-pad_resize,bg-ffffff "UBM China (Shanghai)")
-Ltd..jpg?tr=w-120,h-60,c-at_max,cm-pad_resize,bg-ffffff "Thermore (Far East) Ltd.")
