Cotton futures experienced mixed trading on Friday, with contracts fluctuating between a 7-point decline and a 10-point increase. Notably, the May contract gained 230 points over the week, while the US dollar index fell by $0.104 to $98.485. Meanwhile, crude oil prices dropped by $2.24 as market participants adopted a cautious stance ahead of US/Iran negotiations this weekend.

The cotton market saw managed money reducing their net short positions by 10,206 contracts, bringing their total to just 2,020 contracts. USDA data revealed that cotton export commitments reached 10.25 million RB, down 2% from last year, while shipments exceeded last year’s figures at 6.403 million RB. The Cotlook A Index rose by 30 points to 82.55 cents, indicating a potential upward trend in cotton prices.

Market professionals should note the significant reduction in net short positions, which could signal a shift in sentiment and lead to increased volatility in cotton futures moving forward.

Source: nasdaq.com