DTN Morning Cotton Commentary          09/10 06:34

   Cotton Market Tests Resistance Ahead of Friday's September WASDE

   Overnight, the cotton market was up and is trying to test-out overhead 
resistance.

Keith Brown
DTN Contributing Cotton Analyst

   Overnight, the cotton market was up and is trying to test-out overhead 
resistance. Also, traders are likely squaring certain positions ahead of 
Friday's September WASDE.

   Thursday at 8:30 a.m., the Labor Department will release its PPI (a measure 
of wholesale costs of goods and services). It is forecasted to show a rise of 
supplier-level goods of 0.4%.

   Supplementing Thursday's PPI will be Friday's CPI (consumer inflation) 
report. Depending on these two data points, coupled with the recent stout 
August jobs report, traders could think that the Federal Reserve may indeed 
hike interest rates. The Federal Open Market Committee meets next week from 
Sept. 15-16.

   A fresh round of export sales will be published Friday, delayed by the 
earlier observance of the Labor Day holiday. Last report revealed a sales 
number of 27,525 bales for the 2026/2027 marketing year. That amount was the 
lowest since the big cancellations at the end of the 2023/24 marketing year.

   Then at noon EDT Friday, USDA will release its monthly supply-demand update. 
For that report, the average trade guess calls for U.S. 2026/27 production to 
be 13.19 million bales, down from the previous 13.61 million bales. Exports are 
expected to be at 12.14 million bales, versus 12.30 million bales seen in 
August. Domestic stocks are expected at 3.79 million bales versus the prior 
number of 4.00 million bales. If realized, that would be the lowest ending 
stocks number since 2023/2024 season with 3.15 million bales.

   Lastly on Friday, at 3:30 p.m. EDT, the CFTC will update its Commitments of 
Traders numbers. The last report had the managed-money funds as net-buyers of 
12,000 positions. Their action swelled the overall long carry to 107,936 
contracts. Their record carry was 108,788 contracts.

   For Thursday, close-in support for December cotton stands at 86.00 cents and 
85.50 cents, with resistance around 89.00 cents and 89.65 cents. Thursday 
morning's estimated volume is 15,787 contracts.

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




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