Cotton: Maintaining a volatile trend
ICE cotton is currently mainly focused on demand. Due to the pessimistic outlook for global cotton consumption and US cotton export demand, ICE cotton lacks upward momentum. However, with the high US dollar index falling and Chinese cotton prices stopping falling, the trend of ICE cotton has stabilized, and the market is paying attention to China's cotton import demand.
The domestic cotton market has also been dominated by demand recently. At present, the domestic cotton supply is sufficient, and the market mainly focuses on the demand situation. During the rapid decline in cotton prices in the early stage, the industry sentiment was poor, and under the pressure of low profits and high finished product inventory, the operating rates of yarn and fabric factories decreased. Last week, with the stabilization of cotton prices, the industry sentiment slightly improved, and the slight improvement in fabric factory orders drove the operating rate of fabric factories to rise and the replenishment of raw materials, Cotton yarn inventory has also slightly decreased accordingly.
At present, due to the impact of downstream pre holiday raw material stocking and local order improvement, cotton spot transactions are expected to be relatively stable in the short term. Due to the limited rebound in operating rates and the incomplete digestion of high inventory pressure, cotton prices lack upward momentum, but there is currently no downward pressure. If there is no longer a situation of selling off cotton yarn before the holiday, this relatively stable state is expected to continue until the end of the year; If there is another sell-off of cotton yarn before the holiday, it will have a certain impact on cotton, but the impact is expected to be weaker than in November. So, overall, to maintain the judgment of Zheng Mian's oscillation, the technical support for Zheng Mian 05 is around the early low point of 14500, and the technical resistance is around 15700. It is recommended to operate according to the oscillation strategy.
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