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COTTON

Cotton candy prices experienced a slight decline of -0.1% yesterday, settling at 62640, primarily due to profit booking following recent gains triggered by the release of this month’s 2023/24 U.S. cotton forecasts. The forecasts indicated lower production and ending stocks compared to the previous month's data. Despite this slight setback, the projected marketing year average price for upland producers remains unchanged at 77.0 cents per pound, indicating stability in the market. Globally, cotton supply and demand estimates for 2023/24 show higher production, consumption, and trade, but lower ending stocks. While world production has increased marginally, driven by a significant boost in Indian production, consumption and trade have also risen. However, ending stocks have seen a slight decrease, indicating a balanced market outlook. In the domestic market, the Southern India Mills’ Association (SIMA) has advised textile mills in southern states against panic buying of cotton. The recent price hikes, particularly for the widely-used Shankar-6 variety, have prompted concerns. The Committee on Cotton Production and Consumption has estimated production, imports, and domestic consumption figures for the current cotton season, highlighting a relatively stable demand-supply scenario. Technically, the market is witnessing long liquidation, with a drop in open interest by -2.2% alongside a price decrease of -60 rupees. Cotton candy is currently finding support at 62280, with potential downside tests at 61930, while resistance levels are pegged at 62840, with a breakout potentially leading to prices testing 63050. This technical overview suggests a corrective phase in the market, with traders adjusting their positions in response to recent price movements.

SELL COTTONCANDY MAR @ 62800 SL 63100 TGT 62400-62200. MCX

COCUDAKL

BUY COCUDAKL APR @ 2740 SL 2700 TGT 2790-2820. NCDEX

KAPAS

BUY KAPAS APR @ 1645 SL 1630 TGT 1665-1680. NCDEX