MCX Cotton under fresh selling; Support seen at 19810
Commodity Online | December 03 2020
UPDATED 12:00:00 IST

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Technically Cotton market is under fresh selling as market has witnessed gain in open interest by 2.61% to settled at 2520 while prices down 160 rupees.

Now MCX Cotton is getting support at 19810 and below same could see a test of 19730 levels, and resistance is now likely to be seen at 19980, a move above could see prices testing 20070.

Cotton yesterday settled down by 0.8% at 19900 as price rise halted as supply in the spot markets starts picking up.

According to the Cotton Association of India, this has led to an increase in daily arrivals, reaching about 310,000 bales in the past week (the highest in a decade).

But demand is still strong and rising again and due to geographical advantage Bangladesh is likely to continue purchasing Indian cotton.

India’s cotton crop output could be lower than initial estimates as it has been affected by rains and pest attack, according to various industry players across the country.

The Ministry of Agriculture in its first advance estimate of commercial crops for 2020-21 season (October-September) has pegged cotton production at 371.18 lakh bales (of 170 kg each).

Last week, trade body Cotton Association of India (CAI) estimated cotton production at 356 lakh bales but said that the crop had been affected by excess rains in some regions in the country besides infestation of pink bollworm.

“The weather is not favourable for cotton crop. The hot temperature during day time is not good for the standing crop,” said Atul Ganatra, CAI Chairman.

The crop has been affected in growing regions in North India, Telangana, Maharashtra and Gujarat. “Conditions for the crop in these areas are not good,” he said.

Trading Ideas:
--Cotton trading range for the day is 19730-20070.
--Cotton prices dropped as price rise halted as supply in the spot markets starts picking up.
--The Cotton Association of India, this has led to an increase in daily arrivals, reaching about 310,000 bales in the past week
--But demand is still strong and rising again and due to geographical advantage Bangladesh is likely to continue purchasing Indian cotton.
--In spot market, Cotton dropped by 30 Rupees to end at 19650 Rupees.

Courtesy: Kedia Commodities

Commodity Arrivals Rate
Mustard Oil 4 13700.00
Coconut Oil 0.1 19100.00
Arecanut 1.15 30000.00
Sugar 5 3800.00

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