Bullish news: India will limit cotton exports and use domestic cotton in their mills. The damage to cotton in Pakistan is worse than reported. China also has some flood damage to cotton. The U.S. crop is smaller than expected and some quality problems have occurred in Texas.

Trader open interest increased 2,000 buy contracts last week. Booking by farmers has reached a higher than average level after the recent price appreciation. USDA estimates 2.7 million bale ending stocks. That is really tight. Production estimates up 300,000 bales.

Export demand continues to exceed expectations and deliverable stocks sown to 17,000 bales are extremely tight. Harvest is 6 percent complete, and pressure on prices is possible.

Bearish news: The market has a broad trading range near the yearly high. This is likely to increase price volatility. Trader profit taking from large buy positions is limiting upward price appreciation and could start a market correction. Export sales were disappointing.