资讯 1 10 英文网 283 Cotton News 570485 ZCE cotton to be more volatile in the near future 2017-05-08 15:08:48 yangfang
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ZCE cotton to be more volatile in the near future
2017-05-08

ZCE cotton turned abruptly lower since last Friday after a period of consolidation. Bulls appear to be surprised by the sudden move. 

 

Industry resource noted that cotton belts across major cotton-producing countries are enjoying a favorable weather at present. Spec selling was the prominent force in pushing ICE cotton futures sharply lower last Friday. July contract lost more than 1% to close at 77.77 cent. It registered the second weekly loss in a row, which is 1.4%. 

 

Some industry observers said the weakness in ZCE cotton was triggered by ICE decline. CF1709 touched a low last Friday with increased turnover and a major contacted position. The ZCE volatility appears to be growing at both ends of the trading range. The next downside target is 15500. 

 

Still, some said the most bearish news come from reserve auction, in addition to lower ICE, flat downstream demand and a bumper stock. A major price volatility is expected if reserve sales and auction price change dramatically. 

 

By April 28, cumulative reserve sales for the season reached 869700 tons, including 573600 tons of Xinjiang reserve and 296100 tons of inland reserve. For the week ending April 28, average price rose more than 300 yuan and price is showing an upward trend. 

 

ZCE cotton is currently below physical price and additional steep falls appear unlikely. Price should stay range-bound in the coming days, but in a greater price range.