Cotton futures on April 23 traded firm at Rs 21,410 per bale as participants rolled over their long positions as seen from open interest. The agri commodity traded in the green tracking positive global cues after a gap-up start in the evening session.
The soft commodity has been trading higher than 5, 20, 100 and 200 days’ moving averages but lower than the 50-day moving average on the daily chart. The momentum indicator Relative Strength Index (RSI) is at 49.48 which indicates sideways movement in prices.
“Though some pullback can continue in natural fibre for today’s session due to firm oilseed prices and ICE Cotton futures, a record increase in daily new COVID cases in the country and adequate stock position are likely to keep gains under check in cotton for near future,” said Mohit Vyas, Analyst at Kotak Securities.
The International Cotton Advisory Committee has scaled up its forecast for global prices in 2020-21 (August-July), as ending stocks for the ongoing season are estimated to be lower. The Committee has revised upwards its price forecast for Cotlook A index, a global benchmark for prices of raw cotton, by 3 cents from the previous month of 79 cents per pound.
MCX April Cotton trades at a discount of 17 percent from Cotlook A price of 91.20 cents on Wednesday.
In the futures market, cotton for April delivery touched an intraday high of Rs 21,500 and an intraday low of Rs 21,250 per bale on the MCX. So far in the current series, the commodity has touched a low of Rs 20,340 and a high of Rs 22,760.
Cotton futures for April delivery soared Rs 200, or 0.94 percent, to Rs 21,410 per bale at 16:57 hours IST on a business turnover of 2,454 lots. The same for May contract climbed Rs 200, or 0.93 percent at Rs 21,740 per bale with a business volume of 6,908 lots.
The value of April and May’s contracts traded so far is Rs 60.18 crore and Rs 73.39 crore respectively.
At 1129 (GMT), US Cotton futures were up 1.02 percent quoting at 86.93 cents/pound on Intercontinental Exchange.
For all commodities-related news, click hereDisclaimer: The views and investment tips expressed by experts on Moneycontrol.com are their own and not those of the website or its management. Moneycontrol.com advises users to check with certified experts before taking any investment decisions.