DTN Morning Cotton Commentary          12/30 07:11

   Cotton Grits Teeth Higher 

   The cotton market is holding up this morning even as end-of-the month, 
quarter, and year position squaring is taking place.

Keith Brown
DTN Contributing Cotton Analyst

   The cotton market is holding up this morning even as end-of-the month, 
quarter, and year position squaring is taking place. In that action, some 
growers are "fixing" production, while certain bearish speculators are buying 
in their profits.

   USDA will release its next export sales report this Wednesday, covering the 
time period of Dec. 18th. The last report showed China as a meaningful buyer. 
The previous report reflected sales of 304,700 bales, the strongest since Nov. 
6th. Cumulative sales have reached just 55% of USDA's forecast versus a 
five-year average of 71% for this point in the marketing year.

   The CFTC will issue a Commitment of Traders update on Jan. 5. At last count, 
the managed-money traders were net short some 55,000 contracts. For context, 
their record bearish position was 81,000-plus contracts.

   As of this writing, the cotton market will trade a normal session on New 
Year's Eve, and again on Friday. Of course, trading will be suspended on New 
Year's Day.

   Daily chart support for March cotton stands at 64.10 cents and 63.50 cents, 
with resistance hovering about 65.50 cents and 66.00 cents. Tuesday morning's 
estimated opening volume is 8,245 contracts.

   Keith Brown can be reached at commodityconsults@gmail.com or by calling 
(229) 890-7780.




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