Cotton Prices Hit A 5 Week Low

Cotton Futures---Cotton futures in the March contract settled last Friday in New York at66.69 while currently trading at 64.00 down about 270 points for the week as prices have now hit a 5 week low.

I have been recommending a bearish position from around the 65.00 level and if you took that trade continue to place the stop loss at 67.13, however the chart structure will improve in next weeks trade therefor the monetary risk will be lowered. Cotton prices are trading under their 20-day but still slightly above its 100 day moving average which also stands at major support around the 63.00 level as I think that area will be touched in next week's trade.

One of the main problems for cotton is the fact that we cant come up with a trade agreement with China as they are the number one importer of U.S cotton in the world and until that situation is cemented look for lower prices ahead.

At the current time my only other soft commodity recommendation is a bullish sugar trade as I do think cotton prices have topped out in the short-term so continue to play this to the downside while placing the proper stop loss making sure that you risk only 2% of your account balance on any given trade.

TREND: LOWER

CHART STRUCTURE: EXCELLENT

VOLATILITY: LOW

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