Cotton Is More Likely To Break Down.

Last Wednesday, Zheng cotton made a strong rebound after its recent low point, and closed at a high point in the day. Trading volume and position increased sharply, and market divergence expanded sharply. The author believes that the current cotton (23495,50.00,0.21%) fundamentals are lacking in many factors, and do not have a large scale. Rise Foundation.

The weather is not good enough to increase global production.

According to the quarterly report released by the US Department of agriculture at the end of June, the actual planting area of the United States cotton in 2011/2012 is 13 million 725 thousand acres, which is significantly higher than the estimated 12 million 570 thousand acres in the March planting intention report, which is 25% higher than the 10 million 974 thousand acre in 2010/2011. However, due to adverse weather conditions affecting the production of Dezhou in the largest production area, the total output of US cotton in the new year is expected to be lower than that of 2010/2011. In July, ICAC estimated that the global cotton output in July was 27 million 420 thousand tons, up from 24 million 770 thousand tons in 2010/2011.

The impact of drought in Dezhou has been reflected in the report's expansion and reduction, which has limited impact on the world's massive increase in production. After 2 months of drought, there has been rainfall in some parts of Dezhou recently, and the weather condition has not deteriorated further. At home, Xinjiang cotton is growing well, and the market is expected to advance to the end of August. Some cotton areas in the mainland experienced adverse weather conditions after drought and drought. After the rainy season ended, the weather conditions also tended to moderate. Therefore, we should continue in the near future. speculation The impact of weather on the market is relatively limited.

Market demand continues to slack

market demand Weak from fatigue It is the key factor leading to the weakening of cotton prices. At present, textile enterprises are still facing difficulties in inventory backlog, and price promotions have not improved the situation significantly. The pressure of funds and tight monetary policy have led to the prevalence of private lending. However, high interest rates and poor sales have led many small and medium-sized enterprises to enter a desperate situation. According to market participants, many enterprises have gone through the cancellation procedures every day, and the textile enterprises that have shut down or even closed down may have reached a higher proportion.

In addition, terminal clothing sales are also coldly less than in previous years. According to the clothing industry, this year's clothing sales are in poor condition. The brand clothing started a comprehensive discount sale in early July, and the discount approached the retail bottom line. In the past, summer promotions usually started in mid July. Looking back at the lint market, last week, Wei Qiao textile lowered the purchase price of lint twice. The price of grade three cotton was maintained at 23500 yuan / ton, and the four grade cotton dropped to 21400 yuan / ton. Spot market high-grade cotton because of less stock, relatively stable prices, turnover is better, and the stock of more than three grade cotton is difficult to deal with, basically a day, price, sale is becoming increasingly fierce.

　 To control CPI, the central bank will start raising interest rates again.

In June, macroeconomic data were released soon. The market generally predicted that CPI could exceed 6%. At the right time, the central bank announced that the deposit and loan interest rate will be raised by 25 basis points since July 7th. The third increase in interest rates during the year was expected in the market. It also confirms that controlling inflation is still the primary goal of regulation. Although there is optimistic analysis that the interest rate increase is negative, but I believe that even after this increase in interest rates monetary policy no longer continue to tighten, the policy will not relax in the short term, and interest rates will undoubtedly exacerbate the textile industry's financial pressure.

Nearly two trading days, Zheng cotton main 1201 contract significantly increase one's position size The recent low point and the integer pass of the trial 23000 failed to break through, and the short-term pattern of the 22000 - 23000 oscillation was maintained. However, a large number of funds have been added to the energy market in order to accumulate energy in the late stage of launching the trend market. Zhengmian is still in a downward trend on the technical side, and there is no trend reversal signal. Combined with the basic situation, it is predicted that the probability of breaking down in the late stage of Zheng cotton will be greater.