NEW YORK, April 26: NY cotton ended with strong gains on Friday when option-related buying triggered stop-loss buy orders that reversed steep declines from a day earlier, traders said.
They said the late rally also helped solidify a view for higher levels.
The last five minutes saw a 70 point rally, due to moderate buying into literally a vacuum of overhead offers that enabled the market to regain just about half of what it lost for the week, said Mike Stevens of Swiss Financial Services.
The close in December particularly goes a long way; however, towards building confidence that a trading range is now developing, Stevens added.
Benchmark July cotton settled 1.23 cents higher at 59.09 cents, and traded between 57.60 cents to 59.30 cents a lb. May cotton settled up 1.40 cents at 57.80 cents a lb., trading between 56.15 and 57.80.
Back months rose 1.00 cent to 1.10 cents.
Earlier in the day, brokers said trade buying developed below the market to establish a solid base.
When speculator selling ran out, local and some short cover buying, along with option buying, moved prices up and out of a narrow trading range heading into the last hour.—Reuters
