On April 13-14, ICE futures posted positive results for two consecutive days, with the main contract exceeding 85 cents/pound (the intraday high was 85.71 cents/pound, a new ICE high in the past three weeks). From a technical perspective and market sentiment Judging from the performance of funds and funds, ICE bulls have gradually gained the upper hand, and the stalemate game situation has been broken. The short-term trend is expected to continue to be strong and oscillating, and there is the possibility of testing 88 cents/pound or even 90 cents/pound
A large cotton trader in Jiangsu believes that global cotton consumption will pick up significantly in 2021, the new crown vaccine has been widely vaccinated, the U.S. government has launched a $1.9 trillion economic relief plan, the first phase of the China-U.S. trade agreement will continue to be effectively implemented, and Texas, the United States, etc. Under the favorable support of the continuation of drought and low temperature in some areas, the main ICE contract fell below 80 cents/pound, which was obviously caused by the stampede caused by bullish panic. It is recommended that domestic cotton spinning enterprises and middlemen should stay in the 80-85 cents/pound range of the July contract. Enter the market at low prices in a timely manner, and do not wait and see blindly and “short out” the rebounding market.
Why did ICE’s main contract break the 82 cents/pound and 85 cents/pound integer marks in a row? The author analyzes the following key points:
First, expectations for the Federal Reserve to raise interest rates in 2022 have dropped significantly, the U.S. dollar index has plummeted, and the commodity futures market has rebounded as a whole. On Wednesday, Federal Reserve Chairman Powell said that policymakers will wait until inflation reaches 2% on a sustained basis and the labor market fully recovers before considering raising interest rates. Both conditions are unlikely to be achieved by the end of 2022;
Second, crude oil futures rose sharply, driving up the rise in commodities such as black series, energy, heavy metals, and chemicals. On April 14, the main contract in the U.S. WTI crude oil futures market rose by 4.9%, and the main contract in the Brent crude oil futures market rose by 4.6%;
Third, funds speculated on the weather in the main cotton-producing areas of the United States. Due to the continued low temperatures in the southeast and central-southeast cotton areas, drought and windy weather in Texas have slowed down the sowing progress, providing conditions for bullish speculation in the short term. </p
