Keep an eye on the spread between Jly and Dec, commented one trader. He said this spread is reaching levels that provide enough carry to allow for a rally to have some sustaining moments. A more logical point for aggressive short-covering to develop is above last week's high of 47.55c and again above the April high at 49.88c in Jly futures, traders agreed. Weekly export sales and shipping data were deemed neutral for the cotton market. However, traders said current prices seem to be at levels that are keeping U.S. cotton in the global export mix.
Fresh incentives remain the feature to light dealings in European cotton.
In many cases, buyers have now covered the bulk of European needs through at least the third quarter and can therefore remain on the sidelines, pending more decisive price movement. Major increases also are expected in Brazil, China and India. Copyright 2001 Bridge Information Systems Inc. All rights reserved.