ICE Futures U.S. cotton for July delivery on Wednesday set a fresh contract high and two-year high of 86.80 cents a pound. Wednesday’s technically bullish follow-through buying strength follows Monday’s price action, in which July cotton rose the daily trading limit of 300 points (3 cents). Tuesday’s and Wednesday’s price action in July cotton futures also produced a technically bullish upside “breakout” from a sideways trading range at higher price levels.
The next upside price objective for the empowered cotton market bulls is producing a close above psychological resistance at 90.00 cents a pound. Above that lies longer-term technical resistance at the 2008 high of 91.38 cents, basis nearby futures. The all-time high in nearby cotton futures was recorded in 1995, at 117.20 cents. Near-term chart resistance for July cotton is located at the contract high of 86.80 cents, at 87.00, 87.50 and then at 88.00 cents. Near-term technical support for July cotton futures is located at Wednesday’s low of 84.82 cents, at 84.24 cents and then at 83.00 cents. Major chart support is located at this week’s low of 80.52 cents. Stay tuned! Jim Wyckoff
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