Commodity Check : Cotton

JC Parets
March 30, 2022

Commodities and rates are at the center of everything right now. And why wouldn't they be? That's where the trend is clear. That's where the momentum is! Keeping this trend in mind, one specific commodity will be highlighted in this post.

This is a commodity that has made it to our trade ideas several times in the recent past. After a minor consolidation, the price seems ready for the next move. What are we talking about?

Read on to know more.

Cotton has been one of the strongest agri commodities that we've covered in recent times. Cotton has not only displayed strength, but it has also managed to maintain continued bullish momentum. Now that's a combination that obviously leads to several target revisions. And this post is just that!

Click on the chart to zoom in.

Take a look at this chart. There was a big base breakout in June 2021, and since then, the price has only halted to take a breather. Not a break, but just a breather.

Now take a look at the momentum pane at the bottom. Post the 2020 correction, the indicator has consistently been trading above the level of 50. This continued display of strength in momentum is a big plus for Cotton.

The most recent price breakout came at the level of 38,300. As long as the price sustains above this level, we are bullish with a target close to 52,460.

Do you trade Cotton? Are you looking at stocks within this sector?

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

Allstarcharts Team

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