From the desk of Thomas Bruni @BruniCharting
With Cotton futures nearly 75% off their 2011 highs, market participants may be looking for a reason to get long this market. The weight of evidence however, suggests there is likely another 15% downside ahead.
The daily chart spanning back nine years shows prices topping and subsequently beginning a downtrend in early 2011. Over the past eighteen months prices have consolidated as they attempted to break back above the 2012 lows and downtrend line from the 2011 highs. Despite its efforts, Cotton could not close back above the confluence of resistance at 68 and is now threatening to break through the lower end of the 57-68 range.
From a structural perspective the next logical area [Read more…]