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ICE Cotton Ends Mixed Amid Unceratanities Over US-China Trade deal

12 Dec 2019 8:00 am
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MUMBAI (Commoditiesontrol) – Cotton prices on the Intercontinental Exchange closed mixed on Wednesday amid conflicting fundamental factors.One one hand bullish WASDE report published on Monday supported the market on the other hand uncertainty over US imposing tariff on $160 billion Chinees goods checked any major gains.

The most active March cotton contract ended down by 5 points at 65.88 cents per lb. Volumes in the March contract was down at 12,650 contracts compared with 16,233 contracts a day ago. The May contract ended up by 5 points at 66.97 cents per lb. The July contract was up by 16 points at 67.75 cents/lb. March-May spread was at 107 points.

In its latest, December WASDE report was bullish for the market but there was no follow-through buying as traders waited for US decision on Imposing duty on $160 billion Chinese goods which is scheduled for implementation on 15 th December. The market is expecting that implementation of tariff will be postponed. But If tariffs are implemented then this will further accelerate 17-month-old trade war and would be negative for the market.

Apart from this market will be looking for US exports sales number to be published today for further direction.

Market may move up if US decides to postpone or cancel the proposed increase in tariff on Chinese goods. But higher levels are difficult to sustain as there is ample supply of cotton in China and rest of the world.In fact, at current demand-supply situation and economic scenario it is doubtful that current price levels could hold on for long time.

Support for March contract is at 64 cents/lb and resistance is at 67.6 cents/lb

(By Commoditiescontrol Bureau; +91-22-40015502)


       
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