Is Cotton Due For a Bounce?

For my piece for TraderPlanet I take look at cotton ($BAL). It’s been sliding over the last few months, but is now sitting on support with oversold momentum.

Here’s a blurb:

Looking at the iPath Cotton ETF ($BAL), we can see cotton is just about flat on the year while the PowerShares Multi-Sector Agriculture ETF (DBA) is off nearly 9%. However, it hasn’t been all roses and sunshine for cotton this year.

I wrote a post on my blog in March titled “Are the Sheep About to Get Sheared in Cotton?” – noting the bearish candlestick pattern as well as the fact that the commodity was up against a falling trend line didn’t bode well for further price appreciation. Going forward resistance held and $BAL fell 16% through Friday.

The trend for cotton is still down, and there isn’t enough evidence to say that’s reversing. However, we could still see some kind of bounce.

Source: Commodities: Is Cotton Due For a Bounce? (TraderPlanet)

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