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DTN Morning Cotton Commentary          10/22 08:28

   Cotton Bats Left and Right

   After collapsing to near limit-down levels Thursday, the market is bouncing 
back quite nicely on Friday.

Keith Brown
DTN Contributing Cotton Analyst

   After collapsing to near limit-down levels Thursday, the market is bouncing 
back quite nicely on Friday. It was somewhat disconcerting to see such strong 
sales and poor exports on Thursday, only to have the market focus on the poor 
exports and move sharply lower. Of course, with the global shipping crisis 
intensifying, the rationale among traders is more like "even if you sell it, if 
you can't ship it, then what good is it?" Thus the wild, two-sided action of 
cotton continues.

   Friday afternoon at 4:00 p.m. ET, the CFTC will report on the adjustments it 
makes to the status of traders. To that end, some subscribers have asked about 
how the CFTC knows such information. Well, the government requires certain 
level trading entities, albeit speculators and hedgers, to declare their buying 
and selling actions, and with that data, the tabulators conclude who is long or 
short or spread, and to what depth. Yet the data always lags the immediate 
market. As of last count, the managed-money finds (speculators) remain 
massively net long.

   From Thursday's weekly exports-sales, we note that cumulative sales for 
2021-22 have reached 8.009 million bales. that is off from 2020's 8.46 million, 
and below the five-year average of 8.056 million. Sales have reached 55% of the 
USDA's forecast for the marketing year versus a five-year average of 57%.

   For Friday, close-in support for December Cotton is 105.80 cents and 105.00 
cents, while resistance stands at 109.50 cents, and 111.00 cents. The estimated 
morning volume is 7,415 contracts.

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




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