Cotton prices have been moving in a range for a month. Traders and investors spent the entire last week waiting for the USDA report. Moreover, they were focused on the situation with rains, which were expected in Western Texas. During the period the cotton futures stayed in the 101-104 narrow range. As for the report, the US production of cotton was expected to shrunk by 150,000-250,000 bales.
The forecast for the global consumption of cotton was also expected to be reconsidered in favor of a decline. However, the October report showed no major changes. At the same time the planned export declined by 500K bales down to 11,5m bales. The data made the cotton futures decline in value in the middle of the week.
Now the futures contract is being traded around the major level of $100/b. The market situation will clarify after the forthcoming report on the US export of cotton. In any case, the fundamentals are bearish.
