ICE Cotton Futures Bearish
In March 18th, the US dollar fell sharply from the high level, mainly due to the announcement of the US Federal Reserve's purchase of $750 billion mortgage and $300 billion of long-term treasury bonds. Asian, European and Latin American holders of US dollar debt securities sold dollars. On that day, the US dollar index fell more than 250 points, and fell sharply against the euro area currency.
However, the global commodity futures market did not positively reflect the decline in the US dollar. The CRB index fell by more than 250 points, of which wheat in grain markets fell 15-22.5 cents, soybeans fell 5-7 cents, and corn fell by 2-2.5 cents.
The decline in the grain market spread to cotton futures. The May contract closed below the 21 day price average, and after the price fell, business buying was relatively active. Meanwhile, the shortage of US cotton exports has become a major problem in the market.
After the fall of cotton prices in Central Asia brought a lot of pressure to US cotton sales, it also aggravated the bearish mentality of textile mills. In addition, weak market demand in the United States and Europe also has a negative impact on the market. Kampuchea's clothing exports in January decreased by 25% compared with the same period last year, only 185 million US dollars.
At present, most spot market pactions are dull. Pakistan's domestic cotton trading volume rose, the price was concentrated in 47.04-49.31 cents, and the volume of Turkey's turnover increased. The price of the sale of the Ezi mill is about 51.88 cents, of which the Adana variety price is 43.90-45.23 cents, and the Urfa variety price is about 47.89 cents.
On that day, ICE cotton futures volume reached 15001 hands, and the option traded at 3700 hands. From the perspective of technical graphics, the May contract will enter a downward path, but if the US dollar continues to fall, it may inhibit the decline of futures.
Editor in chief: Xu Qiyun
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