November 22, 2023
With the December Contract All but Gone, Traders Shift Focus to the March Contract
The holiday-shortened trade week was busy with many traders clearing out the rest of their December positions. First Notice Day is on Friday, and daily volume has been active leading up to it. Prices continued to be range-bound this week, having little fundamental or technical data to trade on. One thing to note, however, was that China’s cotton prices were lower this week, which put a little pressure on ICE futures. With one less trading day being covered this week and no export sales to cover on this Cotton Market Weekly, news was light. For the week ending November 22, December futures settled at 79.58 cents per pound, up 90 points. March futures settled marginally higher than last week, finishing at 80.90 cents per pound, up 2 points from last Thursday. Certificated stock increased 3,246 bales to 88,552 bales. Total open interest declined to the lowest level since this past summer, falling 12,198 contracts to reach 194,350 contracts.
Outside Markets
Activity in outside markets was quiet as well, but major indexes continued to climb higher for the week. The stock market has fared well on positive comments from the Fed and encouraging corporate news. Last Fridays close marked three straight weeks of wins for the stock market, with Friday likely to make it four consecutive weeks. Crude oil came off last Thursday’s low but was under pressure on Wednesday when OPEC announced they would delay a meeting that was scheduled to take place on Sunday. The U.S. Dollar was lower, becoming weaker as foreign currencies rallied on stronger economic data and lower U.S. treasury rates. Geopolitical tensions have also eased slightly when it was announced that Israel and Hamas agreed to have a four-day humanitarian cease-fire to release hostages. The stock market is closed on Thursday for the Thanksgiving holiday.
The Week Ahead
Now that December is behind the vast majority of traders, focus will shift to the March contract and typical news releases. The Export Sales Report for the week ending November 16 has been delayed until Friday and will be discussed in next week’s Cotton Market Weekly. Many are expecting the report to hold another week of good sales, as the past few weeks’ lower prices have increased demand. Now that harvest is 77% complete across the country, classing and receiving will be key focal points in the coming week. The market will be closed on Thursday and have shortened hours on Friday, but normal hours will resume on Monday.
With that being said, we hope our readers enjoy the holiday with heartfelt thanks, good food, great fellowship, and safe travels. Happy Thanksgiving!
