Cotton futures settled fractionally higher Friday on speculative buying as a lack of leads becalmed trading and most players waited for news to provide direction for the market next week, brokers said.
The New York Board of Trade's December cotton contract rose 0.14 cent to end at 55.54 cents per lb, dealing from 55.05 to 55.60 cents. March added 0.15 to 58.40 cents. One contract aside, the rest were flat to up 0.15 cent.
"There's no outside stimulus," said Mike Stevens, an analyst for brokers SFS Futures in Mandeville, Louisiana. "It's just stuck in the middle (of its trading range)." Fundamentally, analysts are monitoring the drought-stricken US cotton crop and waiting for the issuance of cotton import licenses by top consumer China.
Otherwise, the trade is waiting for release of next month's monthly supply/demand report from the US Agriculture Department which will contain the first detailed look at market fundamentals in the 2006/07 marketing year (August/July).
Forecasters Meteorlogix said Texas, the top growing state in the country, will be mostly dry this weekend and into Monday with temperatures ranging from 68 to 96 degrees Fahrenheit (20-36 Celsius). A few light showers may hit the area on Tuesday, it said.
The market edged up at the start, lost ground when small speculators sold the market and then crawled back to near unchanged from buying by the same speculators, dealers said.
Sharon Johnson, cotton expert for First Capitol Group in Atlanta, Georgia, said the close above 55.46 cents, basis December, could encourage futures to move higher next week. Broker Flanagan Trading Corp sees resistance in the December contract at 56.25 and 56.70 cents, with support at 55.50 and 54.75 cents. Floor dealers said estimated final volume reached 5,500 lots, versus the previous 4,204 lots. Open interest in the cotton market rose 77 lots to 162,254 lots as of July 27.