DTN Morning Cotton Commentary          08/24 07:18

   Cotton Starts a Monday Retreat 

   After a week of surging prices in which the cotton market gained some 350 
points, it is becoming a tad shy Monday morning. 

Keith Brown
DTN Contributing Cotton Analyst

   After a week of surging prices in which the cotton market gained some 350 
points, it is becoming a tad shy Monday morning. In anticipation of the 
approaching month's end, along with an overbought technical situation, some 
traders may be booking profits and squaring positions.

   Last Friday, the CFTC updated its Commitments of Traders data. The report 
held managed-money funds net-bought some 5,800 positions, augmenting their 
net-long carry to 78,668 contracts.

   Monday at 4 p.m. EDT, USDA will issue fresh condition ratings for the 2026 
U.S. crop. Last week, saw the national crop at 38% good to excellent, down from 
the previous weekly reading of 40%, and way below last year's reading of 55% 
good to excellent.

   In its effort to weaken domestic interest rates, the U.S. Treasury could use 
its general account fund to help buy long-term government bonds to the tune of 
one trillion dollars. Supposedly, Treasury Secretary Scott Bessent has built up 
the general account fund to around $950 billion. Recently, the Treasury 
Department surprised markets by doubling the size of bond buybacks to help 
lower yields.

   Crude oil is lower Monday amid the toughest-ever economic sanctions levels 
ever imposed against Iran. The new sanctions will call on those nations trading 
and supplying Iran to cease and desist. Treasury Secretary Scott Bessent is set 
to unveil a new package of sanctions dubbed an economic D-Day, as the single 
greatest financial offensive ever marshaled against an adversary.

   Chart support for December cotton stands at 87.00 cents and 86.60 cents, 
with resistance around 89.20 cents and 90.50 cents. Monday morning's estimated 
volume is 12,784 contracts.

    

   Keith Brown can be reached at commodityconsults@gmail.com or by calling 
(229) 890-7780.




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