The US Census Bureau’s Mill Consumption Report released this
morning showed mill consumption for the month of June 2008 Annualized at 4.405
MLN bales. The Revised May’08 figure was 4.413 MLN bales down from the previous
figure of 4.510 MLN bales. The year ago figure showed annualized mill
consumption at 4.924 MLN bales.
USDA’s Weekly Cotton Export Report for the week ending 7/17/2008 showed for the
2007/08 season net Upland Sales of 54,900 RB which were down 3% from the
previous week. The major buyers were Indonesia (18,300), Turkey (11,400), China
(9,200), Thailand (5.600), Mexico (4,200), and Bangladesh (3.900). For the
2008/09 season there were net Upland Sales of 95,900 RB. Major buyers were
Turkey (17,500), Indonesia (16,300), Thailand (12,300), China (11,100), and
Bangladesh (8,300). Upland Export shipments this week were 258,000 RB which were
unchanged from the previous week. There were net American Pima sales of 200 RB,
and American Pima shipments of 600 RB. The total net sales of 151,000 RB were at
the low end of the estimate range.
Dec’08 open interest this morning was 163,143 contracts, down 923. Total open
interest was 217,729 contracts, down 837. Certificated stocks total 1,731,122
bales, up 5,298 bales from the previous report. There were 11,779 bales awaiting
review. The 2007/08 North European A-Index was up 110 points at 78.35 and the
B-Index remains unquoted. The Far Eastern A-Index was up 125 points at 77.35.
The 2008/09 Far Eastern A-Index was up 110 points at 79.45.
As the option pit opened, Dec was trading at 73.50. Dec had opened this morning
at 72.97 and a few minutes later made its current low of 72.95. Dec’s current
high of 73.70 was made around 7:45AM. After the option pit trading started, Dec
chopped up to 73.70 and then back down to 73.55 just prior to the release of the
USDA Cotton Export Report. Dec then chopped slowly down to 73.30. Dec held this
level and then slowly moved recovered back up to 73.65. Starting at today’s and
yesterday’s high of 73.70 the scale up resistance intensified. Dec stalled at
this level and then slowly moved back down to 73.13. In Chicago, the electronic
grain markets ended their early morning session a little firmer, with U-Soybeans
up 7 ¼ cents, U-Corn up 7 ½ cents, and U-Wheat up 6 ¾ cents. Crude oil this
morning had traded up about $1.50 per barrel but had now moved back near
unchanged. The Dollar was also about unchanged, only trading up about 5 points
per the Dollar Index. Back to our market, Dec then chopped mostly between 73.20
and 73.45. As the Chicago grains opened, Dec was trading at 73.21. Dec then
chopped it way from 73.10 up to 73.69 but then loss its upward momentum and
quickly fell back down to 73.20. The grains had opened about where the early
morning session had ended but quickly fell into negative territory. With the
grains continuing to lose ground, Dec came under increasing selling pressure
which pushed Dec from 73.20 down to a new low of 72.62(-30). Besides the grains
collapsing, Crude oil was trading down about 90 cents on the day. Dec was able
to stabilize at this level and then chopped between 72.65 and 72.90. Around
11:05AM Dec was able to move back over 73.00 and then persistently moved on up
to 73.51. This level was reached around 12:30PM. This last upward move was made
in the face of continued weakening grain prices, and a Dow which was also being
hammered today, trading down at one time over 150 points. Dec paused at this
level for about twenty minutes. Dec then slowly inched its way up to 73.68. At
1:15PM Dec was finally able to punch through 73.70 and ground on up to a new
high of 74.00(+108). After grinding through increasing scale up selling, profit
taking and new selling pushed Dec back down to 73.60. Dec had recovered back up
to 73.90 just prior to the start of the one minute settlement period. During
this period Dec chopped between 73.93 and 73.76. After this period, Dec ranged
from 73.86 to 73.99. There were about 150 Decs offered between 74.00 and 74.10
which prevented Dec from advancing further. Dec’s last tick of the session was
at 73.99. Dec closed steady, settling at 73.86(+94). The Dec/Oct straddle traded
about 180 times ranging from 275 to 295 points. The Dec/Mch straddle traded
about 375 times, ranging from 543 to 549 points. Estimated volume was 8,600
contracts. Previous day’s volume was 13,921 contracts.
|
Daily Moving Averages: |
Dec |
Oct |
| 3 Day Average |
72.78 |
69.99 |
| 7 Day Average |
73.04 |
70.20 |
| 21 Day Average |
74.86 |
71.84 |
| 40 Day Average |
75.91 |
72.58 |
| 50 Day Average |
76.43 |
73.10 |
| 100 Day Average |
79.72 |
76.66 |
| |
|
|
| RSI: |
48.8 |
49.9 |
|
Contract |
High |
Low |
Previous |
Close |
Change |
| Oct '08 |
71.24 |
69.95 |
70.16 |
71.04 |
+88 |
| Dec '08 |
74.00 |
72.62 |
72.92 |
73.86 |
+94 |
| Mar '09 |
79.40 |
78.25 |
78.39 |
79.33 |
+94 |
| May '09 |
80.81 |
80.40 |
80.03 |
80.80 |
+77 |
| July '09 |
82.00 |
81.66 |
81.17 |
82.03 |
+86 |
| Oct '09 |
---- |
---- |
83.29 |
84.85 |
+156 |
| Dec '09 |
85.94 |
85.50 |
85.01 |
85.97 |
+96 |
| Mar '10 |
---- |
---- |
86.61 |
87.49 |
+88 |
| May '10 |
---- |
---- |
87.63 |
88.49 |
+86 |
| Jly '10 |
---- |
---- |
89.58 |
90.00 |
+42 |
Please address
comments to Weil Brothers-Cotton, Inc., at weilbros@weilbros.com.
Additional Market Information,
including Cotton Options, can be obtained from The New York Board of
Trade.
.