daily trading calls

Cotton on MCX settled up by 0.11% at 18270

Posted on Nov 08, 2017 by kc_admin

Cotton on MCX settled up by 0.11% at 18270 due to rising demand from domestic mills at the spot market. Though, estimation of higher production from major growing regions, capped some gains in cotton prices. The state government has announced the bonus of Rs 500 per quintal to cotton farmers over and above the Minimum Support Prices (MSP). Additionally, as per Ministry of Agriculture, cotton production in India for year 2017-18 may fall by 2.5% to 32.27 million bales against 33.09 million bales of last year. At a time when cotton has started to arrive in the market, dragging the price down, the Cotton Corporation of India (CCI) has begun procurement operations at select places in Gujarat and Telangana. According to top CCI officials, the agency will procure at important cotton growing locations as and when the prices go below the Minimum Support Price (MSP) level once the arrivals gather pace, most likely after November 15. According to CCI officials, procurement in other States, including Maharashtra, Andhra Pradesh and Karnataka, will begin once the arrivals pick up. As per the Centre’s first advance estimate , cotton production is likely to reach 3.22 crore bales, while the trade estimates the output to cross 4 crore bales. Technically market is under short covering as market has witnessed drop in open interest by -4.11% to settled at 3239 while prices up 20 rupees, now Cotton is getting support at 18216 and below same could see a test of 18163 level, And resistance is now likely to be seen at 18346, a move above could see prices testing 18423.

Trading Ideas:

#             Cotton trading range for the day is 18163-18423.

#             Cotton prices ended with gains due to rising demand from domestic mills at the spot market.

#             Though, estimation of higher production from major growing regions, capped some gains in cotton prices.

#             The state government has announced the bonus of Rs 500 per quintal to cotton farmers over and above the Minimum Support Prices (MSP).

#             Cotton prices in spot market dropped by 150.00 rupees and settled at 18190.00 rupees.