Market Analysis: Zheng Mian Rebounded On Tuesday To Recover The 10000 Mark

After a sharp fall on Monday, Zheng Mian's main contract rebounded on Tuesday, recording a daily increase of 1.13% to 16105 yuan/ton. In terms of external market, investors took advantage of the opportunity of sharp price fall on the previous trading day, the weakening of the US dollar further provided support, and the cotton harvest in ICE period was higher overnight. The pressure on the domestic cotton fundamentals still exists, but the technical side is oversold in the short term, which shows a technical rebound at present.

The pressure on the domestic cotton fundamentals still exists, but the technical side is oversold in the short term, which shows a technical rebound at present. Zhongtai Futures said that reserve cotton was still in the process of being released, and the auction turnover rate was less than 30%. At present, the periodic supply in the cotton market has turned loose, the purchase price of Xinjiang seed cotton has fallen, and the purchase price of machine picked seed cotton is 7.2-7.3 yuan/kg. The next shift of lint costs has weakened the support for cotton prices. In the accumulation of textile yarn inventory, the demand for textile exports is poor. In the loss of spinning profits, the contradiction between the price of plateau materials and the poor demand is still unresolved, and the pressure on cotton prices is still on. After continuous technical decline, the short-term market was oversold, facing a technical rebound.

As for the evolution of the market logic, Hongyuan Futures said that the funds with high yield of US bonds have shifted to fixed income, and risky assets have been abandoned, so have commodities. Restricted by the weak demand for domestic cotton prices and the reduction of lint costs, Xinjiang cotton has dropped below 7.5 yuan and the transaction price is 7.2-7.3 yuan, so the lint cost is about 16500 yuan, and there is no sign of stopping falling. The early purchase price of comprehensive seed cotton is high, so it is expected that the annual average cost is 16000 yuan, and the futures price is expected to be around 15000 yuan. Therefore, even if Zheng Mian rebounds in the short term, the strength will not be great, so it is recommended to wait and see.