DTN Morning Cotton Commentary          06/05 08:26

   Cotton Higher, Shadows Dow

   The cotton market sloughed bearish export sales Thursday to essentially 
close unchanged. 

Keith Brown
DTN Contributing Cotton Analyst

   The cotton market sloughed bearish export sales Thursday to essentially 
close unchanged. However, with Friday's surprise job data, the Dow Jones is 
sharply higher and that is encouraging cotton to stay its upside course. The 
employment news showed a stunning increase of 2.5 million jobs for May, with 
the jobless rate declining to 13.3%. The gains were the single largest 
one-month increase on record. Such data indicates an economic turnaround could 
be close at hand, which could be positive for domestic demand for cotton.

   Next week, the market will see supply-demand numbers on Thursday, plus the 
usual export sales. That information will be followed by Friday's options 
expiry for the July Contract. Then on the 24, July cotton will enter into 
delivery, meaning all price-later contracts will be fixed. Then, on the last 
day of June, USDA will report on 2020 Acres. The stage for the new crop season 
is being rapidly set.

   To that point, Texas weather continues to look threatening. The latest 8/10 
day forecasts shows above normal temperatures and below normal rainfall for 
that region. The 7-day emphasis has no rain for West Texas. 

   For Friday, support for July cotton is 60.00 cents and 59.35 cents, with 
resistance at 61.25 cents and 62.00 cents. Current estimated volume is 9,632 
contracts.

    

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




(c) Copyright 2020 DTN, LLC. All rights reserved.