NEW YORK–ICE Futures U.S. cotton settled weaker Monday after trimming losses as the U.S. dollar eased from highs.

Most-active December cotton settled down 68 points at 60.24 cents a pound, and the nearby July contract settled 90 lower at 55.90.

Cotton opened weaker as commodities took a hit from speculative selling amid the stronger U.S. dollar. Futures slid to the 59.07-cent session low basis December and held the level after a retest midday. Cotton pared losses in the second half of the day and settled 29 points below the session high.

Analysts said cotton prices will take cues from the broader economic outlook while traders keep an eye on weather conditions in the U.S. and India’s cotton-growing regions.

Equities are pulling off lows and could bounce in the short term, which would pull commodities prices higher, said Sterling Smith, market analyst at Country Hedging in St. Paul, Minn.

Rain in most U.S. cotton-growing regions over the weekend are bearish for cotton prices, though speculation that conditions are unfavorably cool in the Mississippi Delta region is sending mixed signals, analysts said.

More rain would benefit the developing crop across the Delta and Southeast U.S. states, according to DTN Meteorlogix, a private forecaster. Soil moisture conditions improved for dryland fields in West Texas, though more rain is needed, DTN said.

Mill-buying rests in the mid-50s for December futures and producer-selling is unlikely until the contract hits 65 cents, leaving the market range-bound, said Rogers Varner Jr., president at Varner Brothers, a brokerage in Cleveland, Miss.

December has resistance at 61.50, Smith said.

ICE daily cotton stocks decreased by 19,359 500-pound bales on Thursday to total 418,223 bales, on par with weekly certificated stocks, with 17,526 de-certification orders, according to exchange data.

ICE cotton open interest increased by 762 positions on Thursday to total 112,158, according to the exchange.

[source: futuresource.com]