Combined sales were Mb, pretty much in line with most of the weeks from early Feb. The average over 13 weeks is 484 krb, and the high/low is 648/209 krb. The US has sold 6.3 Mrb in 13 weeks, quite a feat. New crop sales have been as impressive as old, with 790 krb sold in only 3 weeks. This weeks figures saw an all-in lineup of Asian nations, with Viet high at 83 krb and Indo at 60 krb old crop. New crop saw Viet high at 86 krb, China at 53 krb, Indo at 38 krb, Turk and Thai at 35 krb, Pak at 26 krb, and Korea at 23 krb. The only country not making a splash was India. So far there is nothing to suggest a seasonal peak in sales. Shipments were hot at 445 krb.
W TX got a tease Thur morn, as a line of storms began at the Red River on the OK border, and gave some much-needed showers to southern 2N, all of 2S, 3, 7, and most of OK and some of KS. The severe drought districts remain 1N, 1S and 6. We meticulously went through TX this week and came up with a crop estimate with conditions as of 1 May. Now that estimate is too low, as 2N and 2S are in better shape. OK and KS, look downright good. The RGV needs rain, but other TX districts are in very good shape.
Varner View
This market is refusing to acknowledge bullish news. Is it all due to the $s rise of 4%? Perhaps so, as this market has had a deluge of bull in its face in recent weeks. A 4% jump in the $, if perfectly reflected in the price of cotton, would theoretically mean a drop of 350 points. Since the market has not moved an inch, can we then conclude that weather and demand have canceled out the $s 350 point influence? This theory is highly doubtful, but it is an easy observation to see a market in balance. There is nothing in the forecast for 10 days for Lubbock, as usual.
Technicals
The weekly continuation chart shows a potential star top last week, made by the open and close being very close. The top was confirmed by a lower open this week, and needs to close below 8530 on Fri. Cotton made weekly downside reversals in 2016, 2015, and 2014 in late April. Momentum is neutral, seasonal is negative.
As always, please use protective buy and sell stops when trading futures and options.
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