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Cotton market bounces back
02 Oct '08
2 min read
NY cotton recovered from the previous two consecutive contract lows and saw a bounce Wednesday session in the oversold area. The open interest in cotton was reduced by 5,300 contracts yesterday and is now under 200,000 contracts for the first time since end August last year.
Overnight ICE opened at 76 points higher and managed to hold at that level. The market is cautious in making any major movements today before the senate's vote on the financial rescue plan. The trading range in cotton is a little over 100 points and the options pit remained active despite the Jewish holiday.
General commodities market was still showing a loss. Cotton eventually settled at a strong 109 points higher on December contract with average trading volume.
Financial markets are anxiously awaiting on the senate's vote of the bailout plan tonight. The sharp drop in equities Monday created a perfect opportunity for some investors who were ready to pick up good deals. Tuesday session recovered part of the loss from Monday, but investors grew more cautious in making big moves. Dow average was down over 200 points in the early trading, but settled with only a marginal loss.
The U.S. economic picture is certainly not looking good with the bailout plan rejected by the House, neither is the global picture. The weak economic conditions are hitting Asia as well as Europe and there does not appear to be an end nearby. The fear of economic slowdown is worldwide and the commodity prices are affected accordingly. We're trading in the 50's range and demand should come in at this level.
However, the tight credit situation is proved hard on the mills. It looks very bearish both fundamentally and technically and the MACD crossed downwards not long ago. Thought it's not possible to pick a bottom yet, the deep the drop, the sharper the bounce will be.
Click here to view more:
Overnight ICE opened at 76 points higher and managed to hold at that level. The market is cautious in making any major movements today before the senate's vote on the financial rescue plan. The trading range in cotton is a little over 100 points and the options pit remained active despite the Jewish holiday.
General commodities market was still showing a loss. Cotton eventually settled at a strong 109 points higher on December contract with average trading volume.
Financial markets are anxiously awaiting on the senate's vote of the bailout plan tonight. The sharp drop in equities Monday created a perfect opportunity for some investors who were ready to pick up good deals. Tuesday session recovered part of the loss from Monday, but investors grew more cautious in making big moves. Dow average was down over 200 points in the early trading, but settled with only a marginal loss.
The U.S. economic picture is certainly not looking good with the bailout plan rejected by the House, neither is the global picture. The weak economic conditions are hitting Asia as well as Europe and there does not appear to be an end nearby. The fear of economic slowdown is worldwide and the commodity prices are affected accordingly. We're trading in the 50's range and demand should come in at this level.
However, the tight credit situation is proved hard on the mills. It looks very bearish both fundamentally and technically and the MACD crossed downwards not long ago. Thought it's not possible to pick a bottom yet, the deep the drop, the sharper the bounce will be.
Click here to view more:
ECOM USA Inc
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