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Short covering seen in MCX Cotton
Commodity Online | January 12 2018
UPDATED 10:02:18 IST

MCX Nickel under short covering; Resistance seen at 905.3

MCX Aluminium likely to move in a range of 143.8-149

MCX Mentha Oil under short covering; Support seen at 1652.3

MCX Cotton under long liquidation

MCX Cardamom under fresh buying; Resistance seen at 1419.8

Technically MCX Cotton is under short covering as market has witnessed drop in open interest by -8% to settled at 7470 while prices up 430 rupees.

Now Cotton is getting support at 20426 and below same could see a test of 20113 level, And resistance is now likely to be seen at 20936, a move above could see prices testing 21133.

Cotton on MCX settled up by 2.12% at 20740 due to improved domestic as well as export demand at the spot market. Besides, lower than expected production in the country also added support to cotton uptrend. The arrivals have not yet hit the peak levels.

Overall, 20 lakh bales have arrived in Gujarat, while the all-India arrivals are about 100 lakh bales. Also, there are export commitments for about 15 lakh bales, while nearly 9 lakh bales have already been shipped.

The domestic cotton prices are closely connected with the global sentiment, especially with the price movement on New York’s Inter-Continental Exchange (ICE).

The Cotton Corporation of India (CCI) purchased nearly 485,000 bales cotton at minimum support price (MSP) fixed by government as prices are ruling firm, said sources. In a bid to protect the interest of farmers government asked the state agency to purchase the natural fibre at state fixed MSP if prices fall below that level.

"Initially prices were ruling below MSP and we made purchases of 375,000 bales cotton at MSP and the maximum quantity has been bought from the farmers of Telangana," said sources.

Nearly 120,000 bales have in purchased under commercial operation at market prices mainly from the markets of north India, sources added. Last year, prices remained above MSP and the government agency had purchased only around 850,000 bales cotton under commercial operations.

Trading Ideas:

--Cotton trading range for the day is 20113-21133.

--Cotton prices gained due to improved domestic as well as export demand at the spot market.

--CCI purchased nearly 485,000 bales cotton at minimum support price (MSP) fixed by government as prices are ruling firm, said sources

--Overall, 20 lakh bales have arrived in Gujarat, while the all-India arrivals are about 100 lakh bales.

--Cotton prices in spot market gained by 150.00 rupees and settled at 19780.00 rupees.

Courtesy: Kedia Commodities

Commodity Arrivals Rate
Mustard Oil 8.37 10500.00
Coconut Oil 2 21600.00
Arecanut NR 21500.00
Sugar 8.67 3900.00

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