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Cotton Prices Stuck In 8 Week Consolidation


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Cotton Futures--- Cotton futures in the March contract are slightly higher trading up 34 points at 69.18 as I'm currently sitting on the sidelines waiting for a breakout to occur which could happen in tomorrows trade if prices break 69.67 I will then be recommending a bullish position while placing the stop loss at the 2 week low which stands at 68.34 as the risk on the trade would be around $700 plus slippage and commission.

In my opinion the risk/reward would be in your favor if the breakout occurs as prices are still trading above their 20 and 100 day moving average as 64% of the cotton crop has been harvested in the southern part of the United States as that should wrap up in the next couple of weeks as the seasonal lows generally can occur in the month of November.

The U.S dollar is right near a 3 week low as I think that will start to help the agricultural markets including cotton as strong demand has entered this market despite the fact that we do have large ending stocks which means supplies are ample at the current time, however look to play this to the upside as I will not take a short position as I think downside prices are limited.

Cotton has been locked in an 8 week consolidation & as my theory states the longer the consolidation the more powerful the breakout.

TREND: MIXED---HIGHER

CHART STRUCTURE: EXCELLENT

VOLATILITY---LOW

If you are looking to contact Michael Seery (CTACOMMODITY TRADING ADVISOR) at 1-630-408-3325 I will be more than happy to help you with your trading or visit www.seeryfutures.com

Skype Address: mseery TWITTER---@seeryfutures

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Email: mseery@seeryfutures.com

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There is a substantial risk of loss in futures and futures options. Furthermore, Seery Futures is not responsible for the accuracy of the information contained on linked sites. Trading futures and options is Not appropriate for every investor.



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About the author


Michael is the sole owner of SEERYFUTURES.COM which is a commodity futures and options consulting, advisory, and educational firm.

Michael frequently appears on multiple business networks including Bloomberg News, Fox Business, CNBC Worldwide, CNN Business, and Bloomberg TV. He also writes market commentary for several commodity websites and is interviewed for commodity comments by the Wall Street Journal. He is also a guest on First Business, which is a national and internationally syndicated business show.
 
Michael started his career in 1990 at the Chicago Board of Trade as a runner. He soon worked his way up to becoming a Series 3 broker. He works with seasoned traders as well as novice beginners educating them on trading the futures markets as well as using simple and complex option strategies. Michael covers all markets including grains, metals, energies, and all other futures markets that are traded.
 
To Michael the biggest lesson any trader needs to learn is risk management. Michael believes this is the most important factor in trading. He also works with traders to help them determine the proper risk for their trading style. Michael has spent a lot of time educating his clients to help them understand trading strategies and trading techniques while enjoying spending quality time with customers going over the markets or just talking general trading philosophies.

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