DTN Morning Cotton Commentary          10/26 07:18

   Cotton Lower as Harvest Advances; Traders Eye USDA Reports and Fed Meeting

   The cotton market is somewhat lower Monday as domestic harvest activity 
picks up.

Keith Brown
DTN Contributing Cotton Analyst

   The cotton market is somewhat lower Monday as domestic harvest activity 
picks up. Traders note that speculative funds were net buyers last week but are 
also awaiting other USDA reports and the Federal Reserve meeting.

   The CFTC reported Friday, Oct. 23, that the managed-money funds were net 
buyers of 767 positions. That action fractionally increased their net-long 
position to 66,466 contracts. The data was calculated from last Tuesday's (Oct. 
20) settlement.

   This afternoon at 4 p.m. EDT, USDA will issue its weekly Crop Progress 
report. Last week, the U.S. crop was rated 35% good to excellent and was pegged 
at 41% harvested.

   Crude oil is materially lower Monday, as traders weigh the threat of further 
attacks on Saudi Arabia. Monday's pullback follows a sharp rally on Friday 
after attacks by Yemen's Houthi militants on Saudi Arabia's oil infrastructure.

   Tuesday and Wednesday, the Federal Reserve meets to discuss the U.S. 
economy. Recent reports are showing higher concentrations of inflation, and the 
central bank may feel pressed to raise rates. However, most analysts feel that 
the central bank will wait until December to do so.

   Lula da Silva has won Brazil's presidential election, securing an 
unprecedented fourth term after a dramatic comeback from a first-round defeat. 
However, Bolsonaro has refused to concede defeat, saying he would seek the 
annulment of the outcome. The iShares MSCI Brazil ETF plunged nearly 20% in 
overnight trading following Lula's win, as markets braced for the upset after 
Bolsonaro's first round win had sent stocks higher. Bolsonaro is considered to 
be the "conservative candidate."

   For Monday, close-in support for December cotton stands at 79.00 cents and 
78.50 cents, with resistance around 80.20 cents and 81.60 cents. Monday 
morning's estimated volume is 21,328 contracts.

   Keith Brown can be reached at commodityconsults@gmail.com or by calling 
(229) 890-7780.




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