Archive for October, 2013

Dec. 13 moved significantly lower today as the front month tumbled 71 points to settle at 83.11. Dec 13 traded within a 157 point trading range (82.83 – 84.40), making its high in the overnight hours. Volume quickened again today for Dec 13 as well as across all active contracts, with approximately 11.2K and 18.4K lots traded for Dec 13 and in aggregate, respectively. OI decreased again on Wednesday for Dec 13 but increased across all active contracts; OI was approximately 119.1K and 204.5K for Dec 13 and across all active contracts, respectively. Mar 14 gave up 65 points on the day, as it traded within a 153 point range (83.94 – 85.47), the net effect leaving the Dec 13 – Mar 14 spread weakened slightly, settling at (1.19) (down 6 points) on the day. ICE certificated stocks increased significantly again today to stand at approximately 56K bales; approximately 49K bales are currently awaiting review for certification. The Cotton Outlook A-Index was up 50 points to settle at 89.95. CZE-traded cotton in China settled lower overnight; PTA, a major precursor to polyester production, was finished lower as well.

For Monday, our analysis predicts that the most likely directional outcome is a gain on today’s 83.11 settlement. Our outlook period forecast currently relays that while further price dips to test previous resistance at 82.50 and lower may occur, settlement values near those levels is unlikely in the near-term. There is nothing, technically, that suggests that Dec 13 will move swiftly higher to challenge overhead gaps. Our proprietary conditional probability analysis, for tomorrow, concurs with the Average True Range technical indicator in signaling for decreasing market volatility within Dec 13 trading action tomorrow.

ec. 13 moved significantly (and suddenly) higher today as staunch support just above 82.50 and a tanking US Dollar Index gave forced it higher to ultimately gain 66 points on the day and settle at 83.82. Dec 13 traded within a relatively normal 135 point range (82.57 – 83.92). Volume quickened today for Dec 13 as well as across all active contracts, with approximately 10.9K and 17.9K lots traded for Dec 13 and in aggregate, respectively. OI decreased again on Wednesday for Dec 13 but increased across all active contracts; OI was approximately 120.7K and 204.1K for Dec 13 and across all active contracts, respectively. Mar 14 gained 67 points on the day, as it traded within a 143 point range (83.70 – 85.13), the net effect leaving the Dec 13 – Mar 14 spread weakened slightly, settling at (1.13) (down 1 point) on the day. ICE certificated stocks increased significantly again today to stand at approximately 48.8K bales; approximately 43K bales are currently awaiting review for certification. The Cotton Outlook A-Index was off 30 points to settle at 89.45. CZE-traded cotton in China settled lower overnight; PTA, a major precursor to polyester production, was finished lower as well.

The technical picture for Dec 13 is remains weak, today’s strong finish notwithstanding. However, the US dollar has weakened significantly and uncertainty concerning US debt default and further benchmark information from USDA has been removed (although information flow remains currently interrupted). We view these as positive factors.
For tomorrow, our analysis predicts that the most likely directional outcome is a gain on today’s 83.82. However, we would not be long north of today’s pivot point (83.44). The distribution of the tomorrow’s Dec 13 trading range is expected to be nearly symmetrically distributed with an upward bias for very large moves. Our outlook period forecast currently relays that while further price dips to test previous resistance at 82.50 and lower may occur, settlement values near those levels is unlikely in the near-term. There is nothing, technically, that suggests that Dec 13 will move swiftly higher to challenge overhead gaps. Our proprietary conditional probability analysis, for tomorrow, concurs with the Average True Range technical indicator in signaling for decreasing market volatility within Dec 13 trading action tomorrow.

Dec. 13 moved lower today as previously staunch support just above 83.00 gave way to ultimately lose 55 points on the day and settle at 83.16. This is the lowest Dec 13 has finished since Sept 5. Dec 13 traded within a relatively tight 105 point range (82.93 – 83.98). Volume quickened today for Dec 13 as well as across all active contracts, with approximately 10.7K and 16K lots traded for Dec 13 and in aggregate, respectively. OI decreased again on Tuesday; OI was approximately 122K contracts for Dec 13 and approximately 203.8K across all active contracts. Mar 14 gave up 41 points on the day, as it traded within a 92 point range (84.36 – 85.13), the net effect leaving the Dec 13 – Mar 14 spread weakened, settling at (1.12) (down 14 points) on the day. ICE certificated stocks increased significantly again today to stand at approximately 38.4K bales; approximately 41.5K bales are currently awaiting review for certification. The Cotton Outlook A-Index gained 5 points to settle at 89.75. CZE-traded cotton in China settled modestly lower overnight; PTA, a major precursor to polyester production, was finished lower as well.

For tomorrow, our analysis predicts that the most likely directional outcome is conditional on trading action overnight and the early daylight hours (US). The strength of the US dollar subsequent to the temporary debt resolution may very well be a major factor in tomorrow’s trading action. The distribution of the trading range is expected to be nearly symmetrically distributed. Our outlook period forecast currently relays that further price dips to test previous resistance at 82.11 and 81.78 is the most likely path for Dec 13 in the near-term, although this does not necessarily mean tomorrow. There is nothing, technically, that suggests that Dec 13 will move swiftly higher to challenge overhead gaps, however. Our proprietary conditional probability analysis, for tomorrow, concurs with the Average True Range technical indicator in signaling for decreasing market volatility within Dec 13 trading action tomorrow.

Dec. 13 moved slightly higher again today, gaining 10 points as it traded within a very tight 66 point range (83.42 – 84.08). Volume was heavier today for Dec 13 as well as across all active contracts, with approximately 7.6K and 12.2K lots traded for Dec 13 and in aggregate, respectively. OI decreased again on Friday; OI was approximately 123K contracts for Dec 13 and approximately 204K across all active contracts. Mar 14 gained 13 points on the day, as it traded within a tight 77 point range (84.36 – 85.13), the net effect leaving the Dec 13 – Mar 14 spread widened, settling at (0.98) (down 3 points) on the day. ICE certificated stocks increased significantly today to stand at approximately 35.3K bales; approximately 35K bales are currently awaiting review for certification. The Cotton Outlook A-Index gained 25 points to settle at 89.70. CZE-traded cotton in China settled mixed overnight; trade data for PTA was not available today.

For tomorrow, our analysis predicts that the most likely directional outcome is another gain, although without a proper response from congress it will most likely be modest. The distribution of the trading range is expected to be symmetrically distributed, although news from negotiations on the debt crisis could skew it significantly in either direction. Our outlook period forecast currently relays that positive movement is the most likely path for Dec 13 in the near-term. There is nothing, technically, that suggests that Dec 13 will move swiftly higher to challenge overhead gaps, however. Our proprietary conditional probability analysis, for tomorrow, concurs with the Average True Range technical indicator in signaling for decreasing market volatility within Dec 13 trading action tomorrow.