The market situation has been anxious recently, with cotton prices rising and falling, and there is no clear direction. In such an operating structure, does it mean that cotton has completely lost its bull market opportunity? The author believes that what is supposed to come will definitely come. Although it may be late sometimes, it will never be absent. Of course, don’t have too many extravagant hopes at this stage. Break through the pressure level first, otherwise everything will be empty talk.
Now, Zheng Mian has shown signs of rising bottom, but cannot make a substantial breakthrough. This can be seen from the recent futures conference held in Shanghai. Although the author did not attend, I feel from the news spread in the market that this should be a very influential cotton event held in China since the epidemic was brought under control. Not only are there a large number of participants, but the number of guests is also absolutely important. The long and short views at the venue are very clear, and there are sufficient reasons to be bullish and bearish.
The short side believes that under the influence of oversupply, it is impossible to see a sharp rise in the market for a period of time. Even after the epidemic, it will be very difficult. Under the influence of the epidemic, the domestic market alone cannot make up for the reduced orders from foreign markets. At present, the development of the domestic textile industry is facing challenges. With orders reduced, competition fierce, companies rarely making profits, and the foreign trade environment further deteriorating, the pressure on the cotton market is obvious. In particular, Sino-US economic and trade relations are full of uncertainties. These factors are all Inject risk into the market.
Many parties’ views are also relatively clear. They believe that due to the superposition of multiple factors such as the global economic recession, weak consumption, and the US presidential election, there is great upward pressure on cotton prices. Once the darkest moment is over, the dawn is not far away. Now the bottom and high points of cotton prices are constantly rising, and they are obviously in an upward trend channel, showing that cotton prices have a strong willingness to rise.
The public is right, and the mother-in-law is right. The author believes that in the long term, the fluctuation range of cotton prices will continue to increase, but it will not be able to get out of the trend market. After all, the current macroeconomic environment and fundamentals The above conditions are not enough to support cotton prices out of the trend market. However, we must be confident about the future. Under this major adjustment, the entire industry chain is destocking. Once there is a clear positive impact at some point next year, the low inventory in the industry chain will be combined with hedging short orders. By then, the market spot Resources will become tight, especially if all parties in the industry chain are hoarding inventory, resources will only become more scarce, and the market will have the opportunity to explode.
Therefore, the road to the cotton market must be taken step by step. Although the process is long, the future is still promising. Right now, the question for companies is how to safely survive the long cold winter and welcome the arrival of spring.
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