NYCE cotton closed at a fresh nine-month low Monday on speculative sales and spreading as players pressured the market by rolling positions out of the spot month, analysts said.
July cotton slid 1.27 cents to close at 56.53 cents a lb, trading from 56.25 to 58.20 cents. It was the lowest finish for cotton on a spot basis since trading just above 56 cents in late August 2003.
December sank 1.32 cents to 56.19 cents, having touched a new contract low of 55.65 cents. The rest shed 0.50 to 1.45 cents.
"I think some of it is technical," said Sharon Johnson, cotton expert at Frank Schneider and Co Inc in Atlanta.
She said most of the pressure felt by fibre contracts came from speculative accounts and a dearth of support for futures. Cotton had briefly popped higher at the start of business, but the speculative accounts piled in and futures tumbled from a lack of support.
Brokers said the market hit automatic sell-stop orders while it headed south and follow-through sales could eventually push benchmark July cotton down to key support at around 55.50 cents.
Fundamentally, the market is looking toward the weekly crop progress report by the US Department of Agriculture to be issued after the market closes on Monday.
The data were supposed to be handed out on Friday, but US Federal offices will be shut that day as the nation observes a day of mourning for former US President Ronald Reagan who died Saturday at the age of 93.
Brokers Flanagan Trading Corp put support in the July contract at 55.25 and 54.50 cents with resistance at 56.65 and 57.35 cents.
Floor dealers said estimated final volume reached 17,000 lots from Friday's tally of 10,132 lots. Open interest rose 451 lots to 85,521 lots as of June 4.