The soft commodity has been trading higher than 5, 20, 50, 100 and 200 days’ simple moving averages and exponential moving averages on the daily chart.
On the MCX, Cotton futures for May delivery climbed Rs 190, or 0.86 percent, to Rs 22,290 per bale at 19:56 hours IST on a business turnover of 3,062 lots. The same for the June contract rose Rs 190, or 0.85 percent at Rs 22,550 per bale with a business volume of 6,157 lots.
The value of May and June’s contracts traded so far is Rs 75.87 crore and Rs 81.44 crore, respectively.
Mohit Vyas, Analyst at Kotak Securities, said: “Against 11 percent drop in ICE Cotton Futures since the last couple of weeks, domestic cotton prices have marginally moved as prospects of higher exports and falling supply in the physical market have provided a strong floor to domestic cotton.”
Cotton Association of India (CAI) revised Indian Cotton export estimates higher for the 2020-21 season at 65 lakh bales against 60 lakh bales projected till last month and 54 lakh bales projected a few months ago.
MCX May Cotton trade at a discount of 9 percent from Cotlook A price of 88.95 cents as on Thursday.
Higher stock revision by CAI, hit on-demand amid COVID blues and recent sell-off in ICE Cotton futures are likely to keep domestic cotton prices range-bound with negative bias in coming sessions, said Kotak Securities.
The forecast of the timely onset of monsoon in the country by IMD and Skymet this season is also likely to weigh on natural fibre prices in coming sessions.
The soft commodity has been trading higher than 5, 20, 50, 100 and 200 days simple moving averages and exponential moving averages on the daily chart. The momentum indicator Relative Strength Index (RSI) is at 61.12 which indicates upbeat movement in prices.
At 1440 (GMT), US Cotton futures were down 0.66 percent quoting at 82.27 cents/pound on Intercontinental Exchange (ICE).
Source : moneycontrol