Cotton Looking For A Bullish Ride On A Sinking Dollar

      With the US dollar trying to test the lows of the month and still being in a monthly downtrend cotton maybe the one to sweep the street on Monday's Grain Report. June 26th's export sales report, cotton had slipped a little from up 12%  to up 11% and still managed a slight gain. Also the heat in West Texas may have slowed up the crops.

      Technically cotton made through that 8070 resistance on a close on June 25th after a double bounce off the 39 day moving average. If cotton stays below the 8220 level cotton, it will try to find the lows again. I am looking for June 27th to either be a breakout above the 8230 or a retracement back to the 8070 level to find support again. Either way I am bullish on cotton.

     I am looking to purchase the December 83 call and sell the December 89 call for a spread price of $1,000.00 or 200 points. You will have 130 days left in the options. For our money management if cotton decides for a downside spiral on Monday and breaks the 39 day moving average on  a close liquidate the position, or if we take a 30% loss on the spread liquidate the positions. Our maximum loss is the $1,000.00 paid to enter the spread plus commissions and fees, and our maximum profit potential will be $2,000.00 minus commissions and fees.

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To contact Jimmy Tintle email is jimmy@transworldfutures.com or reach him by phone at 1-877-843-4519. Transworld Futures offers a wide variety of trading tools, webinars, and simulated trading. We also various types of accounts from deep discount online trading to managed futures, and FOREX accounts.