================================
Cotton - The Cyclic Viewpoint
================================

Now is the time for me to chime in with my esoteric technical analysis based on Dynamic Cycles.

It is quite obvious that Cotton is in a bear trend. Lower swing tops and bottoms form the obvious pattern below an easily drawn trend line across the tops.

Today's bearish action is not a surprise as is any bearish action occuring the last few weeks/months. Of course, there comes a time when a trend will correct or change. With a correction being the MINIMUM, I believe that time is now.

The first alert that some have mentioned here is the Commercials. Commercials can be net long for weeks before you actually see prices rise. So as a timing aid, it is weak. But as an aid to determining the probability that the next correction may be worth trading 'against the trend', I find it quite useful.

When the COT is showing 90% plus with commercials long, it is time to incorporate more refined timing methods to determine when it is likely that those commercials will actually influence the market. As most of you know, my focus is on cycles for such timing. In addition, Stochastics, MACD and pure support/resistance is tossed in to support the expectation further.

Weekly cycles indicate that Cotton is highly likely to form a weekly swing bottom (WSB) within a single weekly price bar of week 6/18. So on a weekly price chart, this week marks the first probable week for this to happen as it is one bar early. That is the WEEKLY focus. To better refine this, the daily is also consulted.

The daily cycles suggest with high probability that TODAY is a daily swing bottom in the making (6/8). It suggests that price in Cotton is HIGHLY likely to start moving up as early as tomorrow. Now whether today's low will be THE weekly swing bottom is yet to be seen. I prefer the 1-2-3 pattern formation on the daily chart to setup before I get too bullish in a bearish trend, where 1 is the weekly low and 3 is a higher daily swing bottom in the making (and also falls on a daily cycle turn day).

But we're getting a pulse right now.

What I find revealing is that the MONTHLY low in Cotton is currently resting on one of the support levels calculated using 180-degree time/price squaring. The chart below shows this. That isn't to imply that the monthly low cannot go to the lower support levels I've indicated on this chart. But when you are looking for a turn to occur at a specific time, and it just happens that low is at support at that time, it simply adds to the PROBABILITY of a turn. We have to start somewhere.

I'm very optimistic that daily prices will start to form a rising pattern on the daily price charts as early as tomorrow (6/9). This is the short-term (daily) view. And we now know that a weekly swing bottom is due anytime now as well intermediate (weekly) view.

If the monthly low doesn't hold at this support level, that would open Cotton to drop into the 52's, as that is the next support level down for June.

More later...

:)
-R