ICE Cotton Futures Sounded Rally Number

In December 30, 2019, ICE futures continued to hit a new high at the end of the year. The first stage agreement between China and the United States will be signed immediately after new year's day to stimulate the market and make more sentiment.

On Monday, Peter Navarro, the White House economic adviser, said that the first phase of Sino US agreement could be the fastest in the first full week of new year's Day (New Year's second week). Stimulated by the news, ICE futures contract rose nearly 1.7% in March, closing at a new high of 69.56 cents, exceeding the highest level seven months ago.

On the same day, the US dollar index continued to weaken and provide impetus for the rise of the market. As the global stock market approached the historical high point, the US dollar suffered partial sell-off, while the Japanese yen and the euro had many purchases, and the depreciation of the US dollar was beneficial to the export of US cotton. In addition, the US Dow Jones index is very strong, and the rise since Thanksgiving is staggering.

So far, the US cotton contract has been the best in 2010/11 this year, not only higher than the average in the past five years, but also exceeds the speed needed to complete the USDA prediction. China expects to purchase about 800 thousand packs of cotton and cotton, once the first phase of the agreement is signed.

Technically, ICE futures have reached overbought state, but have not yet triggered the automatic selling signal. The underside of the March contract is 68.75 cents and 68.45 cents, and the upper resistance is 70 cents. The ICE futures market closed on New Year's day and resumed trading on Thursday (January 2nd). This week's US cotton export weekly report was postponed to Friday.