DTN Morning Cotton Commentary          05/08 07:34

   Cotton Up, Anticipates Reports

   From its massively oversold situation, the cotton market is electing to show 
strength Wednesday. 

Keith Brown
DTN Contributing Cotton Analyst

   From its massively oversold situation, the cotton market is electing to show 
strength Wednesday. Traders on both sides are gearing up for what may be 
several meaningful reports. 

   Spot May cotton is set to expire Wednesday on the close. To date, some 
400-plus delivery notices have been tendered against that contract. July cotton 
will start its own delivery process in seven weeks, on Monday, June 24.

   This Thursday, USDA will issue a fresh round of export sales. Last week's 
net sales were off 45% weekly, and down 20% on the monthly average. 
Additionally, shipments were down 30% weekly, and off 39% on their four-week 
average.

   On Friday, USDA will present its monthly supply-demand updates in the May 
Crop Report. Government statisticians will give their initial estimates on 
yield and production levels for the U.S. and world new crops. Traders' 
expectations will be revealed in Thursday's commentary. The report will be 
published at 12:00 p.m. EDT.

   The six-to-ten-day forecast is showing below to well below normal 
temperatures for the U.S. Cotton Belt. Meanwhile, rain chances are slightly 
above for Texas, but much-above for the Southeast.

   For Wednesday, chart support for July cotton stands at 76.50 cents and 76.00 
cents, with 79.85 cents and 80.50 cents as resistance. Wednesday morning's 
estimated volume stands at 8,301 contracts. 

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




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