New York cotton stays up

US cotton futures added to the previous session's advance after weekly export sales came in well above forecasts, and prices held at higher levels into the close on Thursday, suggesting demand for the fiber may be improving, brokers said. The December cotton contract in New York finished at 59.24 cents a lb, a 0.56 percent or 0.33 cent gain.
The range moved up to a higher high at 59.49 and a higher low at 58.53 cents compared with Wednesday's range. The December cotton tally was light at 3,358 lots by 2:59 pm EDT (1859 GMT). March cotton was up 0.38 cent, or 0.62 percent, at 61.67 cents by the end, with volume light at 424 lots. Cotton prices firmed early following release of the US Department of Agriculture's weekly report on exports, showing sales increased much more than anticipated.
USDA showed US export sales of upland cotton for the week ended August 27 jumped 31 percent to 305,500 running bales compared with forecasts for 225,000 bales. The largest sales increases were reported by China with 88,500 running bales, Turkey at 71,100 bales, Mexico at 53,300 bales and Bangladesh at 22,100 running bales. "The very good sales continue to underscore a pickup in demand at lower (price) levels, with the market dropping to 60.33 to 57.00 (in the last month)," said one broker.
Market speculators have been selling the highs and buying the lows of that trading band in recent sessions, with little fundamental news driving those traders, brokers said. Brokers have pointed out that cotton sales increase every time prices fall below 58 cents a lb on the December contract. Next week, when cotton players return from the long US Labour Day weekend, they will wait for the US Department of Agriculture's monthly supply/demand data due September 11.
Broker Flanagan Trading Corp put next resistance for December cotton at 59.60 cents a lb, then 60.55 cents, with support levels set at 58.75 and 57.90 cents a lb. Total cotton volume fell on Wednesday to 7,026 lots from 9,896 lots on Tuesday, exchange data showed on September 3. Open interest rose by 635 lots to 124,623 lots on September 2 from 123,988 on September 1, ICE Futures US said.