July 26, 2012 Institutional Watch - Cotton Futures

[Hongyuan

Zheng cotton short line is the opportunity for investors in the middle line.

Main points

1. Price Bulletin: domestic lint: 129 level 20294 yuan / ton; 229 level 19436 yuan / ton; 328 level 18524 yuan / ton; 428 grade 17617 yuan / ton.

Domestic textiles: polyester staple fiber 9730 yuan / ton; viscose staple fiber 15050 yuan / ton; C32S price 25380 yuan / ton.

2. domestic spot: domestic cotton spot prices continued to rise slightly.

At present, the global cotton is still in a loose supply and demand pattern. Therefore, it is difficult to see a strong rise in cotton prices. Although the state has reiterated the policy of purchasing and storage, the cotton purchase and storage in the new year will take some time. Textile demand has not changed.

3. imported cotton: in July 25th, the price of China's main port of imported cotton continued to decline, and most varieties fell 1.25 cents.

At present, the spot market remains depressed, and port inventory is hard to digest. The European debt crisis and the economic downturn in the United States make the market even worse.

4. commercial inventory: the national cotton market monitoring system started a nationwide survey in late June 2012 to early July. It involved more than 100 cotton enterprises and warehouses and bonded warehouses in 15 provinces (municipalities and autonomous regions).

The results showed that as of the end of June, the national cotton business inventory was about 1 million 70 thousand tons, and in addition, there were about 800 thousand tons of cotton inventory in the bonded areas without customs clearance.

5.ICE cotton: in July 25th, ICE cotton ignored the good news of the decline in the US dollar index and the rebound of grain futures. After the opening of the contract in December, it repeated around the 20 day moving average, but with the 40 day moving average, the technical selling was triggered, causing the cotton price to dive rapidly, and the settlement price hit the lowest level in a month.

Summary:

The two major factors that affect domestic cotton prices are demand and policy. There is no substantial change in demand.

The reserve cotton business conference of the central storage cotton company once again made clear the policy of open storage and storage of cotton in the new year, so as to boost market confidence.

There are 19700 pressure near zhengmian, and there is an important average line support.

But on the 26 day, the 1301 contract of zhengmian was lower, breaking down the concussion interval, which is the first time that the 40 day EMA has been awarded for the first time in nearly 15 trading days. The short term of technology is still weak, and the short term investors can be short.

[MEIKO futures] imported cotton yarn during the pressing period to support the cotton back.

Overnight, in July 25th, ICE cotton ignored the good news of the decline in the US dollar index and the rebound in grain futures. After the opening of the contract in December, it repeated around the 20 day moving average. However, as the 40 day moving average was conquered, technical selling was launched, resulting in the rapid price jump of cotton and the lowest settlement price in a month.

If the market does not show any significant positive news, the December contract will continue to explore the bottom.

News, Xinjiang production and Construction Corps News Office press conference: in the first half of 2012, due to the decline in industrial economic efficiency, the Xinjiang production and Construction Corps textile industry from profit to loss, loss of 102 million yuan, 200 million yuan reduction.

In the first half of this year, the Xinjiang production and Construction Corps completed the total output value of agriculture 7 billion 790 million yuan, an increase of 10.2% over the same period last year.

Among them, 8 million 238 thousand and 900 mu of cotton, an increase of 5.1%.

International market, 25, the main port of China's imports of cotton prices continued to decline, most varieties fell 1.25 cents.

At present, the spot market remains depressed, port stock is hard to digest, and the European debt crisis and the recession in the United States have made the market worse.

From the overall perspective, the weak market structure will continue and the peripheral market will lead the cotton price in the near future.

Domestic market, 25, domestic cotton spot prices continue to move up to the national reserve line.

At present, domestic and foreign cotton price difference as high as 4200 yuan / ton, such a high price difference, let the small profit textile enterprises covetous high-quality cotton, repeatedly asked the national issuance quota issuance, and cotton purchase and sale enterprises worry that once the increase, the domestic cotton prices will be hit again, so they will sell the cotton price for sale, and raise funds for the new flower listing purchase. At present, there are still few purchase and sale enterprises in the hand.

Spot quotation. In July 25th, the price of C/A cotton in the US was 88.85 (cents / pound), and the general trade port delivery price was 15189 yuan / ton (calculated according to the sliding tax). The Australian cotton quotation was 92.10, the general trade port delivery price was 15612 yuan / ton, the Uzbekistan cotton quotation was 92.10, the general trade port delivery price was 15612 yuan / ton, the India cotton quotation was 84.10, the general trade port delivery price was 14599 yuan / ton.

The national cotton price A index was 19436 yuan / ton, up 9 yuan; the B index was 18524 yuan, up 13 yuan.

{page_break}

Market analysis, at present, the global economy is facing downward pressure and consumer demand remains low. The domestic textile enterprises are struggling with their business. Due to the shortage of imported cotton quotas, many downstream enterprises have imported cotton yarn and put pressure on the middle links, while restricting domestic cotton consumption enthusiasm.

But after all, autumn and winter.

The stocking period has been added to the next year, and it has brought some support to cotton prices.

Therefore, it is possible to continue to maintain the range concussion and pay attention to macro orientation.

Operation, the 19000-19725 interval concussion, short-term trading is the main.

[Wanda futures] worries about the European debt crisis make us cotton three Lian Yin report.

Despite the strong rebound in overnight grain prices, Spain's borrowing costs rose and people worried that Greece might not honour the terms of the bail-out, exacerbating fears over the euro area, which led to the continued fall in the ICE cotton market under the pressure of technical selling. The main contract in December fell 1.52 cents to 69.51 cents / pound, and 70 cents / pound strong support fell. If cotton prices continued to two cents a day at 70 cents / pound, the decline would continue, and December contracts would challenge the strong support position of 65 cents / pound.

Technically, the ICE cotton contract for December was closed for three consecutive days, and cotton prices closed below the short-term average. The 70 cent / pound support was lost, and the KD and MACD indicators were bonded to form a downward trend. The red flag of the MACD index shortened to the vulnerable area under the 0 axle. If the December December contract could not stand firm 70 cents / pound, the downtrend will continue, and the downward target will reach 65 cents / pound strong support position.

Zheng cotton, which remained weak on Wednesday, was dragged down by the drop in the external market. Meanwhile, the market rumors that today's NDRC held a meeting to discuss the issue of the issuance of quotas, which is one of the main reasons for the decline of Zheng cotton.

At present, consumption is in a downturn because of the global economic downturn. Chinese products are not competitive because of high cost, orders continue to decline, and overall market consumption is sluggish.

At the same time, the issuance of quotas or dumping will change the current supply structure of the market. Therefore, although Zheng cotton has a tendency to close to 20400 yuan / ton, however, in the case of the possibility of dumping and raising the quota, Zheng cotton will remain weak, keep the blank idea and continue to hold empty orders, pay attention to 19100 yuan / ton supporting position and 19400 yuan / tonne pressure level, such as 19100 yuan / ton support has been verified, and the single profit reduction.

[Huaan futures] Zheng cotton disadvantaged finishing unchanged short space visible slot pin

Key points:

1, the central bank on Tuesday reverse buy back 95 billion to continue to put liquidity into the market, the central bank's continuous waterproof shows that the current market still has downside risks, which will not be far away.

2, Fung announced that in July, China's Manufacturing Purchasing Managers' index (PMI) preview value was 49.5, the figure hit a 5 month high, PMI hit a 5 month high, mainly because the steady growth policy of the country began to show effectiveness.

3, the overall growth of cotton in the United States is better than last year. The total output of cotton in India next year is expected to be uncertain.

External trend: New York July 25th, cotton futures on the Intercontinental Exchange (ICE) fell low on Wednesday, close to a month low, brokers pointed to a drop in a technical standard, triggering speculative selling.

The cotton contract in December fell 1.52 cents, or 2.1%, at 69.51 cents per pound, and the intraday trading range was between 69.40 and 71.70 cents. Thomson Reuters data show that this is the lowest settlement price in the past month.

Early comment: overnight, the US cotton fell three days in a row, and the technology graph turned to a downtrend, focusing on Thursday night.

Sales report; domestic side, the central bank has recently increased liquidity to the market. In July, the PMI index has been improving, and the commodity market has been improving. The spot market sales have improved and the prices have slowly recovered. With the new market year approaching, the purchasing and storage price of 20400 will play a more and more important role in supporting the market. Eventually, the market price will be guided by 20400.

For Zheng cotton, the US cotton continued to drop to a certain extent will drag Zheng cotton, so short-term callback or inevitable, but under the support of the purchase and storage price, there is little space below, investors wait for the medium and long term multiple single machine meeting, short term homeopathy and empty participation, but do a good job of stop loss.

At present, the price difference between the MA1209 market and the futures market of the matching market is between 235 yuan / ton. Due to the convenience of the delivery warehouse, there is still a profit in the short term of futures trading and matching, and the relevant enterprises can grasp this risk free arbitrage opportunity. "CF1209"

On the operation, Zheng cotton main force 1301 contract, short term homeopathy empty single participation, stop loss 19400; medium and long line investors wait for more single buy opportunities, 19100 convenient to buy in batches.