Cotton Resolving Higher

JC Parets
May 31, 2021

Commodities have been a part of the discussion for quite some time. As base metals and precious metals alternate between their outperformance, another commodity is now taking center stage.

Cotton has been on our radar for quite some time, but we've been waiting for a resumption in trend. Much like the equity market, cotton too was stuck in a sideways mess.

Well, it seems like that mess has cleared.

Over the weekend, we saw the price register a strong move in cotton and we thought it'd be worth a discussion.

Cotton had been struggling to get past the level of 22,500 since April 2019. What we have here is a two-year base breakout! The price has closed above the level of 22,500 with a strong bullish candlestick. The indicator is headed towards positive territory as well.

So what's the view going forward?

As long as the price trades above the level of 22,500, the bias is higher, with a target near 24,330. And the risk management level to be tracked would then be 22,500.

A move below 22,500 and we're not interested anymore. That's the level to watch out for!

Click on chart to enlarge view.

As the commodities figure their way out, we continue to track the names that are displaying strength and are moving past crucial resistances.

Thanks for reading and please let us know if you have any questions.

Allstarcharts Team

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