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You are here: Home / Not Books / The Cotton Club Letter – For Week Ending 12/9/2016

The Cotton Club Letter – For Week Ending 12/9/2016

The Cotton Club Letter – For Week Ending 12/9/2016
 
 
  Price Picture

Chart Source: Barchart.com

 
 
Trend Picture

Chart Source: Barchart.com

 

Notes
Nearby contract closed approximately 24 points lower
this week.

Managed money is net long.
Short-term, technical traders see possible support around 70
.20, possible resistance around 72.00.
The trend is up.

Price
Mar-17 is at:   70.80        Volume = 16
May-17 is at:  71.11         Volume = 3
July-17 is at:   70.99        Volume = 1
Cotlook ‘A’ Index is at: 79.55


Cash Sales

Recently, on 5,543 bales traded, the trading platform TheSeam.com reported an average cash price of approximately: 67.80.
On the nearby contract, that puts the average basis at approximately:  –300 points.
Cash prices are averaging approximately 14.39 cents over loan value.

Stocks and Sales
ICE Certified Cotton Stocks = 60
,693
US Net Upland Export Sales (2016/2017) = 405,200
     Vietnam was the big buyer at 103,200. 

Current World Balance Sheet (2016/2017)
Beginning Stocks: 96.80 (million 480 lb. bales)
Production: 104.24
Mill Use: 111.91
Ending Stocks: 89.15
Ending Stocks/Mill Use Ratio: 79.7% 


Current China Balance Sheet (2016/2017)
Beginning Stocks: 58.20 (million 480 lb. bales)
Production: 21.00
Mill Use: 35.75
Ending Stocks: 47.85
Ending Stocks/Mill Use Ratio: 133.8%

Current India Balance Sheet (2016/2017)

Beginning Stocks: 10.94 (million 480 lb. bales)
Production: 27.00
Mill Use: 23.75
Ending Stocks: 11.79
Ending Stocks/Mill Use Ratio: 49.6%

Current USA Balance Sheet (2016/2017)
Beginning Stocks: 3.8 (million 480 lb. bales)
Production: 16.52
Mill Use: 3.50
Ending Stocks: 4.80
Ending Stocks/Mill Use Ratio: 137.1%

 
Commitments of Traders
Producer / Merchant
    Long:  18,873  (Contracts)
    Short: 186,419
Swap Dealers
    Long:  60,387
    Short:  10,473
Managed Money
    Long:  92,970
    Short:  8,494
Other Reportables
    Long:  34,482
    Short:  12,186

Cotton Club Letter Price Model:  Current Price Is Available By Subscription Only
A 
regression model
, like the one located here can give insight into how prices, on average, would react given a change in one or more fundamental supply or demand factors. A proper interpretation of this price model would be: 


“Over the last number of years, if cotton supply and demand were at their current levels, we would – on average – expect the US price of cotton to be approximately:  X cents.”

*Note – This model does not attempt to forecast the future direction or level of cotton prices. 


General View
Bullish.
Keep in mind that while this is a weekly letter, I can easily change my mind in 24 hours. 


Click Here to Read The Last: 10 Points on the ICE Cotton #2 Chart(CT)


====================


The Cotton Club Letter Archive can be found by clicking, here

If this was forwarded to you and you’d like to sign up, email me at sterlingterrell [at] outlook [dot] com with “Cotton Club” in the subject line.
Email with “Stop Cotton” in the subject line to be removed.

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