Cotton Market: Future Prospects And Operational Suggestions

Greece became the first developed country that failed to repay the IMF loan. The debt crisis frustrated global stock and commodity prices, and Greece's debt problem and whether to withdraw from the eurozone were one of the focuses of the market.

The unemployment rate in the United States has declined, the labor market has been on the track of steady recovery, and the employment market has further improved. This indicates that

The possibility of raising interest rates is increasing.

China's economic downturn has slowed down, but the stability of the foundation is not solid, manufacturing industry is still weak, the Chinese government and central bank will continue to implement the stimulus measures to maintain a relaxed.

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From the factors that affect the market this week, we can see that the positive factors are mostly temporary, and there is no sustained.

The price is not overly weak, but it has been repeatedly digested by the market. The US cotton planting area estimate has been reduced to the lowest level in 30 years, which has become the main profit point in the past week. The rainfall in Dezhou has hindered the planting of crops, which may reduce the planting area. Although the sowing area is expected to decrease, the final output is the harvest area and the yield per unit area. Rainfall has prevented the seeding progress, but has also made the cotton production area full of drought and soil moisture. This is conducive to the increase of the yield per unit area, which may offset the losses caused by the reduction of the sowing area. This is uncertain. China's high price dumping and storage has its support but has limited influence. The export sales figures are good, and this is the main support for us cotton prices for a long time, supporting cotton.

The final decision is whether the market is still in demand and supply, and the market demand has been slow to improve. China's reserves are huge and began to put cotton reserves in the market. India is also releasing its reserves, the demand is shrinking and the inventory is at a high level. The supply has not shown a sharp decline. The reduction of the sowing area in the new year can not reverse the serious surplus of supply. The market supply and demand pattern has changed little, and cotton prices have been under pressure.

The pattern has improved, but the auction price has given the market a little confidence, at least the panic mentality of the market has been greatly alleviated. In 2012, the auction price of 14200 yuan / ton of national cotton reserves showed two intentions of the government, one is to lift the cotton price, which is to take account of the problems of not pressing the market, and the cotton farmers' income and stabilizing the cotton planting area in 2015/2016. Two, the cotton prices in the two years are larger, and also shows that the government has strong intention to go to Chen cotton. This pricing effect will be long-term. It is an important reference for the domestic cotton price and the cotton price in 2015/16. Cotton processing enterprises and textile enterprises can operate according to the price according to the price, which has certain advantages for domestic and foreign cotton prices. Domestic cotton has not been consumed, the downstream demand is flagging, and the supply of cotton reserves has increased supply, which, of course, is not conducive to market supply and demand.

At present, from the domestic perspective, the market is gradually losing its market, the general direction of stock going is constant, and the market situation is bad, but at the worst time it may have passed.

In the coming week, cotton prices will continue to bear weight. The ICE cotton futures contract in December has a greater resistance in the vicinity of 68 cents, with more technical side, but it is also not easy to make a breakthrough. Zheng cotton futures rebound is not easy. The resistance above the 1601 month contract is near 13500, but it will not be a big drop.

This week, the overall performance was higher and higher and higher, higher than before, ending the previous four weeks of weak market, the center of gravity moved upward, there is a rebound trend, but uplink resistance is still larger, the price is still below the average, not completely out of the weak market, the short-term rebound is limited, the upper line short-term resistance in the vicinity of 13500.