April 22, 2024

 Cotton is a roaring BUY here…

But I’ll start with this…

Buy Cotton

After catching the 20-25 cent rally in January and February, and exiting perfectly into the Feb 28 spike, I again recommended buying after Cotton had almost immediately tumbled about 8 cents. That recommendation has been DEAD WRONG with the market now having given back the entirety of its recent rally...And I am not being bull headed about my opinion, and this may sound strange, but I think this Cotton decline is “ARTIFICIAL” and directly connected to what has happened in Cocoa...

How could that be?...Both are very small markets and traded on the same exchange along with Coffee and Sugar, and with some very large commodity houses often being involved in all four of these “Softs” markets, I am dead certain that this ENORMOUS move in Cocoa has resulted in some number of BIG players getting blown off the map…which typically involves MASSIVE margin calls and the forced liquidation of positions in not only Cocoa, but any other positions they might have had…which IS, I believe, what has been THE major factor in the Cotton sell off…and has absolutely nothing to do with supply and demand…That is, as I am always noting, more than anything else, price changes are all about big, big bucks sometimes chasing and sometimes FLEEING the markets…and that is exactly what I think has happened in Cotton.

And so what comes next for Cotton?

Call me if you think these ideas are worth doing something with…

And I seriously doubt either of them is just going to lay here and do nothing right now…

Thanks,

Bill

770-425-7241

866-578-1001

All option prices in this newsletter include all fees and commissions. All charts, unless otherwise noted, are by Aspen Graphics and CRB.

The author of this piece currently trades for his own account and has a financial interest in the following derivative products mentioned within: Cotton