ICE Cotton Futures Consolidation Decline In Recent Directions Unknown

As of November 22nd, when the ICE futures contract was lower in March, it did not get support until the end of the week, and prices returned to the low level. The basic news of the week included: the US cotton exports were generally good, and the quality of new cotton testing continued to decline.

As of Thursday November 21st, ICE futures contracts for March and July contracts closed at 64.01 cents per pound and 66.14 cents per pound respectively, and December contracts closed at 66.56 cents per pound. ICE holdings and volume declined.

In recent months, ICE has shown a trend of continuous fluctuation, and the trend can take place in two directions. On the one hand, the price of new cotton will be under pressure with the advent of a large number of new cotton. On the other hand, the further confirmation of the Sino US trade relations agreement, or the unexpected reduction in the output of the main producing country, or other things that are entirely expected, may lead to more empty compensation.

This rebound should be a selling or hedging opportunity, mainly considering the following reasons: 1, the speculative factor driven rise is often short-lived; 2, the main contract price to more than 65 cents may stimulate more point price and hedging; 3, just like in October 3rd, the commercial fund to carry out the spot price and increase the guaranteed sales volume, the fundamental bad will eventually suppress the price.

The only certainty for the market is that no one knows the ultimate direction of price. Therefore, the most important question is whether the current futures price will be sold or whether the hedging will be profitable.