Supporting the commodities outlook, the China, the world’s top consumer of metals, grains and energy, is seeing its economy stabilize. Moreover, the depreciating U.S. dollar has helped support demand for commodities as an alternative hard asset or a better store of wealth. However, bearish views on agriculture commodities linger.
Investors should also be mindful of cotton’s technicals.
Looking at the daily chart for March Cotton futures, we notice prices trading at 1 month lows as of this writing, as the recent upward momentum appears to have run its course. Prices have fallen below the 20-day moving average, which gives the advantage to short-term Cotton bears. Momentum as measured by the 14-day RSI has turned weak with a current reading of 39.25,” adds Options Express.
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