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Published on 21/09/2021 2:03:21 PM | Source: Kedia Advisory

Cotton trading range for the day is 24700-25880 - Kedia Advisory

Posted in Commodities Reports| #Commodity Tips #Kedia Advisory

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Gold

Gold yesterday settled up by 0.63% at 46278 as concerns about property group China Evergrande’s solvency drove world shares lower, stoking risk aversion, while traders awaited the outcome of this week’s U.S. Federal Reserve policy meeting. A surprise gain in August U.S. retail sales rekindled early Fed tapering fears, boosting the dollar. Retail sales and jobless claims figures came in above expectations, giving ammunition to bets on early Fed tapering. A separate report from the Labor Department showed first-time claims for U.S. unemployment benefits rebounded by slightly more than expected in the week ended September 11th. The Federal Reserve hold its next policy meeting on Tuesday and Wednesday, a session that will include the release of fresh economic projections and a new read on officials' interest rate expectations. A pullback in domestic prices failed to revive physical gold demand in India this week, with jewellers banking on the upcoming wedding and festive season, while top consumer China saw an uptick in buying. Dealers in India were charging premiums of up to $3 an ounce over official domestic prices. In China, premiums rose to $5-$9 per ounce on average over global benchmark prices, from $3-$4 last week. Russia's gold reserves stood at 73.8 million troy ounces as of the start of September,the central bank said. Technically market is under short covering as market has witnessed drop in open interest by -11.71% to settled at 7958 while prices up 292 rupees, now Gold is getting support at 45981 and below same could see a test of 45683 levels, and resistance is now likely to be seen at 46476, a move above could see prices testing 46673

Trading Ideas:

Gold trading range for the day is 45683-46673.
Gold rose as concerns about property group China Evergrande’s solvency drove world shares lower, stoking risk aversion
Investors fretted about the spillover risk to the global economy from Evergrande’s troubles.
India jewellers eye festive boost as buyers ignore price dip
 

 

Silver

Silver yesterday settled down by -0.64% at 59609 amid a firmer dollar ahead of a week packed with no less than a dozen central bank meetings. However downside seen limited as stocks in Asia and Europe slumped amid concerns around debt-laden Chinese developer Evergrande's inability to pay part of its huge debt due on Thursday. Confidence among U.S. single-family homebuilders edged up in September, reversing a three-month decline as elevated costs for some building materials including softwood lumber eased, a survey showed. The National Association of Home Builders/Wells Fargo Housing Market Index rose one point to 76 last month. Builder sentiment hit an all-time high of 90 last November as the COVID-19 pandemic fueled a housing market boom, with more people forced to work from home. Investors also await the outcome of the Federal Reserve's two-day meeting starting on Tuesday for more clues about the withdrawal of the QE program. Fed Chair Jerome Powell said that the tapering could happen this year depending upon the strengthening of the economy. Other major central banks due to hold monetary policy meeting this week include the Bank of Japan, the Bank of England and the Swiss National Bank. Technically market is under long liquidation as market has witnessed drop in open interest by -2.94% to settled at 13760 while prices down -383 rupees, now Silver is getting support at 59154 and below same could see a test of 58699 levels, and resistance is now likely to be seen at 60132, a move above could see prices testing 60655..

Trading Ideas:

Silver trading range for the day is 58699-60655.
Silver dropped amid a firmer dollar ahead of a week packed with no less than a dozen central bank meetings.
However downside seen limited as stocks in Asia and Europe slumped
Fed Chair Jerome Powell said that the tapering could happen this year depending upon the strengthening of the economy.

 

Crude oil

Crude oil yesterday settled down by -1.44% at 5210 as more U.S. Gulf oil output came back online in the wake of two hurricanes. The U.S. dollar, rose as worries about Chinese property developer Evergrande’s solvency spooked equity markets and investors braced for the Federal Reserve to take another step towards tapering this week. A rise in the U.S. rig count, an early indicator of future output, to its highest since April 2020 also kept a lid on prices. China's state reserves administration said it would auction around 7.38 million barrels of crude oil on Sept. 24, marking the first batch of sales in a rare release of strategic inventories. The National Food and Strategic Reserves Administration had said last week it would release batches of crude oil reserves to the market to help stabilise prices. Saudi Arabia, the world's biggest oil exporter, kept its ranking as China's top crude supplier for a ninth straight month in August as major producers relaxed production cuts. Saudi oil arrivals surged 53% from a year earlier to 8.06 million tonnes, or 1.96 million barrels per day (bpd), data from the General Administration of Customs showed. Technically market is under fresh selling as market has witnessed gain in open interest by 26.41% to settled at 3346 while prices down -76 rupees, now Crude oil is getting support at 5153 and below same could see a test of 5095 levels, and resistance is now likely to be seen at 5277, a move above could see prices testing 5343.

Trading Ideas:

Crude oil trading range for the day is 5095-5343.
Crude oil dropped as more U.S. Gulf oil output came back online in the wake of two hurricanes.
A rise in the U.S. rig count, an early indicator of future output, to its highest since April 2020 also kept a lid on prices.
China to auction 7.38 mln bbl of crude from state reserves on Sept 24


Nat.Gas

Nat.Gas yesterday settled down by -2.67% at 372.2 as forecasts for milder weather offset expectations record global gas prices would keep U.S. exports high. With gas inventories in Europe at extremely low levels heading into the winter heating season when demand peaks, prices in both Europe and Asia traded at all-time highs over $25 per million British thermal units (mmBtu). That compares with just $5 in the United States, prompting buyers around the world to keep purchasing all the gas the United States can produce. U.S. LNG exports would have been higher this month but were reduced by a brief shutdown at Freeport LNG's plant in Texas during Tropical Storm Nicholas and the start of maintenance at Berkshire Hathaway Energy's Cove Point in Maryland. Gas speculators last week cut their net long positions on the New York Mercantile and Intercontinental Exchanges for the first time since August in anticipation of the price drop that started late last week following a bigger-than-expected storage build, according to data from the Commodity Futures Trading Commission (CFTC). U.S. gas stockpiles, however, were still about 7.1% below the five-year normal for this time of year. Those low inventories, like those in Europe, helped boost U.S. gas prices to their highest in seven years early last week. Technically market is under long liquidation as market has witnessed drop in open interest by -31.57% to settled at 4593 while prices down -10.2 rupees, now Natural gas is getting support at 365 and below same could see a test of 357.9 levels, and resistance is now likely to be seen at 380.2, a move above could see prices testing 388.3.
Trading Ideas:

Trading Ideas:
Natural gas trading range for the day is 357.9-388.3.
Natural gas eased as forecasts for milder weather offset expectations record global gas prices would keep U.S. exports high.
Gas inventories in Europe at extremely low levels heading into the winter heating season when demand peaks
U.S. LNG exports would have been higher this month but were reduced by a brief shutdown at Freeport LNG's plant in Texas


Copper 

Copper yesterday settled down by -2.29% at 704.65 as China reiterated plans to release more metals from its reserves. Chile’s copper commission Cochilco forecast the global copper market to be in a supply deficit of 153,000 tonnes in 2021, while it expects a surplus of 190,000 tonnes for 2022. Investors were in wait-and-watch mode with a U.S. Federal Reserve meeting taking the spotlight in a week full of central bank events. Policymakers from major economies including Japan and the UK are due to meet this week, though the focus is on the Fed's two-day meeting that will conclude on Wednesday, with markets expecting it will stick with broad plans to begin tapering this year. Aurubis AG , Europe's largest copper producer, said its Stolberg copper products plant in Germany will start resuming some production on Nov. 1. Heavy rain and flooding in July had stopped production at the Stolberg plant and force majeure was declared on deliveries. The plant is in North Rhine-Westphalia near Aachen and produces about 35,000 tonnes of copper products annually. China's refined copper output in August rose 1.9% year on year to 874,000 tonnes, its highest monthly level since April. Technically market is under fresh selling as market has witnessed gain in open interest by 2.86% to settled at 3494 while prices down -16.5 rupees, now Copper is getting support at 699.4 and below same could see a test of 694 levels, and resistance is now likely to be seen at 713.8, a move above could see prices testing 722.8.

Trading Ideas:

Copper trading range for the day is 694-722.8.
Copper prices dropped as China reiterated plans to release more metals from its reserves.
Chile’s copper commission Cochilco forecast the global copper market to be in a supply deficit of 153,000 tonnes in 2021
Aurubis Stolberg copper products plant to resume some output in Nov

 

Zinc

Zinc yesterday settled down by -1.05% at 253.55 as the prospect of a debt default at China property developer Evergrande Group fuelled a sell-off across financial markets and investors headed for the safe haven dollar. Evergrande has been scrambling to raise funds to pay lenders, suppliers and investors, with regulators warning that its $305 billion of liabilities could spark broader risks to China’s financial system if not stabilised. On the macro front, the National Development and Reform Commission expressed that it will focus on stabilising and promoting individual incomes, and further optimizing the reforms of electricity pricing, and ensuring the live pig market stability. Total zinc inventories across seven Chinese markets stood at 117,200 mt as of September 17, down 5,800 mt from September 13 and 2,400 mt from September 10. Inventories in Shanghai increased as government stockpiles arrived at plants and downstream producers reduced restocking. Guangdong saw a slight decline in stocks as downstream buyers will restock cargoes before the Mid-Autumn Festival holiday.Stocks in Tianjin fell sharply as in-plant cargoes at smelters have overstocked due to logistics restrictions, arrivals of goods in the market were muted on suspension of production at individual smelters as well as downstream plants have pre-holiday restocking demand. Technically market is under long liquidation as market has witnessed drop in open interest by -9.88% to settled at 1067 while prices down -2.7 rupees, now Zinc is getting support at 252.2 and below same could see a test of 250.8 levels, and resistance is now likely to be seen at 255.2, a move above could see prices testing 256.8

Trading Ideas:

Zinc trading range for the day is 250.8-256.8.
Zinc dropped as the prospect of a debt default at China property developer Evergrande Group fuelled a sell-off across financial markets
China’s zinc output was down 0.6% year on year at 541,000 tonnes.
Total zinc inventories across seven Chinese markets stood at 117,200 mt, down 5,800 mt from September 13 and 2,400 mt from September 10.
 

Nickel

Nickel yesterday settled down by -1.87% at 1444.4 as the dollar rose before the Fed meeting, where policy makers are expected to start laying the groundwork for paring stimulus. Indonesia is exploring the possibility of levying an export tax on nickel products with less than 70% nickel content to drive expansion of its domestic processing industry, Investment Minister Bahlil Lahadalia said on Friday. Indonesia is keen to develop a full supply chain for nickel, from extracting ore from its rich nickel reserve to producing batteries and assembling electric vehicles (EVs) at home. Market watchers were concerned by ongoing supply constraints of the metal while downstream demand remains resilient. Talks of output curtailment for nickel pig iron (NPI) also shored up prices. Some NPI producers in China's eastern Shandong province had reduced production recently, and that is seen to "significantly affect" raw material supplies. Indonesia is exploring the possibility of levying an export tax on nickel products with less than 70% nickel content to drive expansion of its domestic processing industry. Indonesia is keen to develop a full supply chain for nickel, from extracting ore from its rich nickel reserve to producing batteries and assembling electric vehicles (EVs) at home. Technically market is under fresh selling as market has witnessed gain in open interest by 2.43% to settled at 1179 while prices down -27.5 rupees, now Nickel is getting support at 1434.2 and below same could see a test of 1424.1 levels, and resistance is now likely to be seen at 1457.2, a move above could see prices testing 1470.1.

Trading Ideas:

Nickel trading range for the day is 1424.1-1470.1.
Nickel dropped as the dollar rose before the Fed meeting, where policy makers are expected to start laying the groundwork for paring stimulus.
Indonesia considers export tax for products with less than 70% nickel content
Market watchers were concerned by ongoing supply constraints of the metal while downstream demand remains resilient.


Aluminium

Aluminium yesterday settled down by -0.29% at 226.7 on growing concern about China’s crackdown on the real-estate sector. Global primary aluminium output dropped to 5.699 million tonnes in August from a downwardly revised 5.733 million tonnes in July, data from the International Aluminium Institute (IAI) showed. Overall, primary aluminium production in August rose 3.15% year on year, the IAI said. Estimated primary Chinese production fell to 3.299 million tonnes in August from 3.327 million tonnes in July, it added. China's aluminium imports in August fell 20.7% from the previous month, data from the General Administration of Customs showed, hitting their lowest since May. Arrivals of unwrought aluminium and products - which include primary metal and unwrought, alloyed aluminium - were 247,547 tonnes, down from 312,086 tonnes in July and down 42.4% from a year earlier. A Japanese aluminium buyer has agreed to pay a global producer a premium of $220 per tonne over the benchmark price for shipments in October to December, up 19% from the current quarter to reflect higher overseas premiums. Social aluminium inventory added 15,000 mt the week but fell 5,000 mt from Monday September 13. Technically market is under long liquidation as market has witnessed drop in open interest by -0.64% to settled at 2031 while prices down -0.65 rupees, now Aluminium is getting support at 224.8 and below same could see a test of 223 levels, and resistance is now likely to be seen at 227.9, a move above could see prices testing 229.2.

Trading Ideas:

Aluminium trading range for the day is 223-229.2.
Aluminium prices dropped on growing concern about China’s crackdown on the real-estate sector.
Global aluminium output drops in August – IAI
China Aug aluminium imports fall 20.7% from prior month

 

Mentha oil

Mentha oil yesterday settled down by -2.62% at 921.2 as pressure seen after the news that US House Democrats have proposed a tax hike on tobacco and nicotine to help fund their $3.5 trillion spending plan. The measure may increase current levies on cigarettes, cigars and roll-your-own and smokeless tobacco, according to a plan summary. They have also proposed new taxes on vaping products. Pressure also seen after the news that the Food and Drug Administration has proposed a ban on menthol cigarettes, suggesting it may prompt 923,000 U.S. smokers to quit, according to one study. Goldman Sachs covering the beverage and tobacco sectors, pointed to the potential federal menthol ban as another area of concern for retailers. This year US FDA announced it is taking steps to ban menthol as a characterizing flavor in cigarettes, and ban all characterizing flavors — including menthol — in cigars within the next year. In Goldman Sachs' Nicotine Nuggets survey, nearly 70 percent of retailers said they expected cigarette volume declines to accelerate in 2021. In Sambhal spot market, Mentha oil dropped by -40.3 Rupees to end at 1058.7 Rupees per 360 kgs.Technically market is under long liquidation as market has witnessed drop in open interest by -11.63% to settled at 965 while prices down -24.8 rupees, now Mentha oil is getting support at 910.9 and below same could see a test of 900.7 levels, and resistance is now likely to be seen at 935.8, a move above could see prices testing 950.5.

Trading Ideas:

Mentha oil trading range for the day is 900.7-950.5.
In Sambhal spot market, Mentha oil dropped  by -40.3 Rupees to end at 1058.7 Rupees per 360 kgs.
Mentha oil prices dropped pressure seen after the news that US House Democrats have proposed a tax hike on tobacco and nicotine.
The measure may increase current levies on cigarettes, cigars and roll-your-own and smokeless tobacco, according to a plan summary.
Goldman Sachs covering the beverage and tobacco sectors, pointed to the potential federal menthol ban as another area of concern for retailers.

 

Soyabean

Soyabean yesterday settled down by -5.03% at 5961 as exports of soyameal dropped by 58.93 per cent in August in view of high prices that made the commodity lose its competitive edge in the global market. Chinese importers bought four to six bulk cargoes of Brazilian soybeans early this week for shipment in October and November, an unusual purchase during the peak export period for rival supplier the United States. The deals for up to an estimated 360,000 tonnes of soybeans were inked as export terminals along the U.S. Gulf Coast in Louisiana, the country's busiest crop shipping outlet, have struggled to recover from damage, flooding and power outages caused by Hurricane Ida on Aug. 29. The Commodity Futures Trading Commission's weekly commitments of traders report also showed that noncommercial traders, a category that includes hedge funds, cut their net long position in soybeans. China’s Soybean imports are forecast at 101 million metric tons (MMT) in marketing year (MY) 21/22, up 3 MMT from the previous year. The increase is based on growing soybean meal feed use, lower soybean production, and limited imports of rapeseed. Soybean imports for MY20/21 are estimated at 98 MMT, a slight fall from the previous year that is mainly due to decreased pork and poultry profitability. At the Indore spot market in top producer MP, soybean dropped -1436 Rupees to 7095 Rupees per 100 kgs.Technically market is under fresh selling as market has witnessed gain in open interest by 7.33% to settled at 33685 while prices down -316 rupees, now Soyabean is getting support at 5830 and below same could see a test of 5699 levels, and resistance is now likely to be seen at 6163, a move above could see prices testing 6365.

Trading Ideas:
Soyabean trading range for the day is 5699-6365.
Soyabean prices dropped as exports of soyameal dropped by 58.93 per cent in August.
Chinese importers bought four to six bulk cargoes of Brazilian soybeans early this week for shipment in October and November
In Marathwada, there were concerns about mosaic virus, as well as infestation of pink and American bollworm.
At the Indore spot market in top producer MP, soybean dropped  -1436 Rupees to 7095 Rupees per 100 kgs.
 


Ref.Soyaoil

Ref.Soyaoil yesterday settled down by -1.29% at 1295.8 as pressure seen tracking weakness in overseas prices due to a rapid progress in the U.S harvest season. Favorable weather over the weekend boosted U.S. harvest, while exports remain capped by terminals on the U.S. Gulf Coast that continue to struggle with power outages and hurricane-led damage as the country heads into its busiest export season. India's vegetable oil imports are likely to contract for the second straight year, the Solvent Extractors' Association of India (SEA) said. Imports in 2020/21 marketing year ending Oct. 31 could fall to 13.1 million tonnes, the lowest in six years, from last year's 13.2 million, B.V. Mehta, SEA executive director, said in a virtual conference. Palm oil imports, however, could rise 8% from a year ago to 7.8 million tonnes, he said, as India allowed imports of refined palm oil and cut the import tax on crude palm oil. India's export of oilmeal, used as animal feed, declined 4 percent to 1,64,831 tonne in August from the year-ago period, in view of domestic shortage of the key oilmeal products. To meet local shortages, the government has allowed import of genetically modified (GM) soyameal and it should give some relief to the poultry industry, it said in a statement. At the Indore spot market in Madhya Pradesh, soyoil was steady at 1345 Rupees per 10 kgs.Technically market is under long liquidation as market has witnessed drop in open interest by -8.65% to settled at 23700 while prices down -16.9 rupees, now Ref.Soya oil is getting support at 1290 and below same could see a test of 1283 levels, and resistance is now likely to be seen at 1307, a move above could see prices testing 1317

Trading Ideas:

Ref.Soya oil trading range for the day is 1283-1317.
Ref soyoil prices dropped as pressure seen tracking weakness in overseas prices due to a rapid progress in the U.S harvest season.
Oilmeal exports down 4% in August: SEA
India vegetable oil imports seen shrinking for second year – SEA
At the Indore spot market in Madhya Pradesh, soyoil was steady at 1345 Rupees per 10 kgs.

Crude palm Oil

 Crude palm Oil yesterday settled down by -0.24% at 1110.2 amid weakness in Malaysian prices as higher export tax and a slowdown in September shipments so far also weighed on sentiment. Malaysia's palm oil exports during Sept. 1-20 rose 38% to 1,089,071 tonnes from the same week in August, cargo surveyor Amspec Agri said. However, this was slower than a 54% monthly rise in Sept. 1-15. Malaysia maintained its October export tax for crude palm oil at 8%, a circular on the Malaysian Palm Oil Board website showed. The world's second-largest palm exporter calculated a reference price of 4,472.46 ringgit ($1,068.18) per tonne for October, up from 4,255.52 ringgit in September. India has cut base import taxes on palm oil, soyoil and sunflower oil, a government order showed, as the world's biggest vegetable oil buyer tries to cool near-record price rises. The reduction in taxes could bring down prices of the edible oils in India and boost consumption, effectively increasing overseas buying by the south Asian country. The base import tax on crude palm oil has been slashed to 2.5% from 10%, while the tax on crude soyoil and crude sunflower oil has been reduced to 2.5% from 7.5%, the government said in a notification. In spot market, Crude palm oil dropped by -7.8 Rupees to end at 1141.3 Rupees.Technically market is under long liquidation as market has witnessed drop in open interest by -3.89% to settled at 4824 while prices down -2.7 rupees, now CPO is getting support at 1101.3 and below same could see a test of 1092.4 levels, and resistance is now likely to be seen at 1119.8, a move above could see prices testing 1129.4.

Trading Ideas:

CPO trading range for the day is 1092.4-1129.4.
Crude palm oil dropped as higher export tax and a slowdown in September shipments so far also weighed on sentiment.
Malaysia's palm oil exports during Sept. 1-20 rose 38% to 1,089,071 tonnes from the same week in August
India cuts import taxes on vegetable oils to calm prices
#n spot market, Crude palm oil dropped  by -7.8 Rupees to end at 1141.3 Rupees.
 

Mustard Seed

Mustard Seed yesterday settled down by -0.41% at 8492 after it took several measures to boost domestic supply and curb hoarding. Statistics Canada cut its canola production estimate to a 13-year low, due to drought. Prices seen supported as Government has increased the Mustard seed MSP from 4650.00 to 5050 i.e Rs.400 per quintal for RMS 2022-23. Support also seen amid regular demand from the stockists and lowering all India arrivals. In their August report, the IGC lowered their forecast for the world rapeseed production to 70.9 million tons (-2.2 compared to July and 72.1 compared to 2020/21). The rapeseed production in Canada will be 16 million tons (-2.8 and 18.7), 4.5 million tons in Australia (4.2 and 4.1), 2.8 million tons in Ukraine (2.7 and 2.7). USDA estimates Canada rapeseed production for marketing year 2021/22 at 16.0 million metric tons (mmt), down 4.2 mmt (21 percent) from last month, 3.0 mmt (16 percent) from last year, and 20 percent below the 5-year average. Harvested area is estimated at 8.7 million hectares, down 3 percent from last month, but 4 percent above last year, and roughly equivalent to the 5-year average. The month-to-month decrease in area is due to the expectation of weather-related abandonment with prospects for hay being the best use. In Alwar spot market in Rajasthan the prices dropped -95.65 Rupees to end at 8600 Rupees per 100 kg.Technically market is under long liquidation as market has witnessed drop in open interest by -1.58% to settled at 44950 while prices down -35 rupees, now Rmseed is getting support at 8387 and below same could see a test of 8282 levels, and resistance is now likely to be seen at 8566, a move above could see prices testing 8640.

 

.Trading Ideas:

Rmseed trading range for the day is 8282-8640.
Mustard seed prices seen pressure after it took several measures to boost domestic supply and curb hoarding.
Statistics Canada cut its canola production estimate to a 13-year low, due to drought.
Government has increased the Mustard seed MSP from 4650.00 to 5050 i.e Rs.400 per quintal for RMS 2022-23.
In Alwar spot market in Rajasthan the prices dropped -95.65 Rupees to end at 8600 Rupees per 100 kg.

Jeera

Jeera yesterday settled down by -1.84% at 14165 as adequate stock with traders and farmers may keep prices under pressure at higher levels. However downside seen limited as the export of cumin is increasing continuously and in the coming days there are signs of increasing the export of cumin in a big way. With the forecast of normal rains in the western region during September to November, the sowing of cumin seeds in Gujarat and Rajasthan may increase. In 2021 (January-June), the country has exported more than 1.50 lakh tonnes of cumin as compared to 1.3 lakh tonnes in the same period last year. Purchase of cumin seeds from African and Middle East countries will be diverted from other countries to India this year. With Gujarat and Rajasthan being the only producers of cumin in the country, the most impact of Skymet's forecast is visible on the cumin market. The export of cumin is increasing continuously and in the coming days there are signs of increasing the export of cumin in a big way. However, the freight of container-vessels has increased and the shortage of containers is increasing continuously. In Unjha, a key spot market in Gujarat, jeera edged down by -255.75 Rupees to end at 14347.6 Rupees per 100 kg.Technically market is under long liquidation as market has witnessed drop in open interest by -9.38% to settled at 5334 while prices down -265 rupees, now Jeera is getting support at 14010 and below same could see a test of 13855 levels, and resistance is now likely to be seen at 14335, a move above could see prices testing 14505.

 

Trading Ideas:

Jeera trading range for the day is 13855-14505.
Jeera dropped as adequate stock with traders and farmers may keep prices under pressure at higher levels.
However downside seen limited as the export of cumin is increasing continuously and in the coming days there are signs of increasing the export of cumin
India's cumin exports will increase due to less supply from Afghanistan-Syrian
In Unjha, a key spot market in Gujarat, jeera edged down by -255.75 Rupees to end at 14347.6 Rupees per 100 kg.



Cotton 

 Cotton yesterday settled down by -1.72% at 25160 as the new cotton crop has begun arriving in northern markets, Karnataka and Telangala with prices of kapas (raw cotton) ruling at least 10 per cent higher than the minimum support price (MSP) levels fixed by the Centre for the new season starting October. Cotton acreage this year is lower by 5.75 per cent at 119.66 lakh hectares, as per Agriculture Ministry’s latest data. The overall crop condition is good as on date and, based on the feedback from the 10 growing States, the yield will be much higher this year and quality very good. The demand is slow as most of the spinning mills have covered their needs till December. If the moisture comes down, demand may improve over the next couple of weeks. The latest spell of heavy rains in Gujarat may appear to have saved the State from sinking into a drought, but for the current kharif crops such as cotton, it has pushed back the harvest period by at least 15 days and also weakened the prospects of kharif groundnut due to waterlogging. In September WASDE report, the USDA projected U.S. production at 18.5 million bales, 1.2 million bales higher than the previous month. In spot market, Cotton dropped by -130 Rupees to end at 26490 Rupees.Technically market is under fresh selling as market has witnessed gain in open interest by 7.76% to settled at 1945 while prices down -440 rupees, now Cotton is getting support at 24930 and below same could see a test of 24700 levels, and resistance is now likely to be seen at 25520, a move above could see prices testing 25880.

 

Trading Ideas:
Cotton trading range for the day is 24700-25880.
Cotton prices dropped as the new cotton crop has begun arriving in northern markets, Karnataka and Telangala
Cotton acreage this year is lower by 5.75 per cent at 119.66 lakh hectares, as per Agriculture Ministry’s latest data.
The overall crop condition is good as on date and, based on the feedback from the 10 growing States
In spot market, Cotton dropped  by -130 Rupees to end at 26490 Rupees.
 

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