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March 10, 2023
ICE Cotton is grinding lower from $82.18 to $81.34 per pound, shedding 84 cents (1.02%) today.
Non Farm Payrolls data from United States will be released today at 13:30 UTC with analysts expecting a decline to 205,000. Potentially significant price fluctuations in Cotton are expected to follow.
Highly important Initial Jobless Claims data from United States beat analyst expectations of 195,000 with a reading of 211,000.
Trend and momentum analysis indicates that the Commodity Channel Index (CCI) indicator is below -100, meaning the market price is unusually low and below its rolling moving average. Technical analysis indicates that a new, strong downtrend could be forthcoming with short positions favored. Price action remains constrained around the key Fibonacci level of $81.8 currently serving as support. If price action breaks below, the next Fib hurdle is $80.44. According to asset volatility analysis, ICE Cotton's lower Bollinger Band® is at $80.9, indicating that the asset has overextended to the downside and could, therefore, bounce back as buyers look for bargains. Chart analysis indicates ICE Cotton could begin to recover as it approaches significant support, now 10 cents away from $81.44. Dipping below could be an indication that further losses are ahead.
All in all, the technical analysis suggests the Cotton future has no clear-cut direction.
In the meantime, negative performances are also seen in other Softs as Sugar is trading around $20.9 (down 25 cents). Cocoa slips 1.24% to trade around $2,698.
With markets struggling for positive sentiment, upcoming macro data could potentially attract buyers in the market as United States Non Farm Payrolls expected to decline to 205,000 while its preceding data was 517,000, data will be available today at 13:30 UTC.
Furthermore, United States Unemployment Rate figure is projected at 3.4. It previously stood at 3.4; data will be released today at 13:30 UTC.
The commodity has been trending lower for about 2 months. Approximately 10 months ago, ICE Cotton reached a significant high of $154.89 but has struggled to hold onto its gains and declined 46.94% since then.
