Which way now for cotton futures?
After trading sideways, with a slightly upward bias, for more than a week, New York's December contract found more definite direction, downwards, in the last session, closing 1.4% lower at 68.25 cents a pound.
"Finally, we have seen some real movement in cotton futures," said trading house Ecom.
Has this set the direction to come?
Ecom was not too reassuring for bulls, saying that "the futures market is showing us that is really doesn't care about the hurricanes," ie Harvey and Irma, which swept through parts of the US cotton belt, "and expect that the damage will be minimal to the size of the crop".
Nor was Tobin Gorey at Commonwealth Bank of Australia who, terming the last session's price fall as "certainly a jolt for the market", added that "this might be the market returning to normality" which could mean harvest pressure on prices.
"The market will seasonally feel the weight of US supply as a still-large crop comes to market."
While there are estimates that the US may have lost well over 1m bales of cotton to the hurricanes, this is in the context of a harvest that the US Department of Agriculture had pegged at 21.8m bales, a rise of 4.6m bales year on year.
One hope for bulls is that at least the downside could be minimal, with Mr Gorey noting that "December cotton futures seemed to find support just below 67 cents a pound prior to the hurricanes".
But it is by no means certain that this floor will hold again, given the large net long, of more than 70,000 contracts, that hedge funds have built in cotton futures and options – which looks precarious if an upswing in values is not forthcoming.
"I would expect the speculators who added longs above the 72-cents-a-pound level would be starting to get concerned as the market drops away, and doesn't look to be returning to those levels without a catastrophic event happen, "Ecom said.
"If we can make it until cotton gets in the bale without any major hiccups then the specs will have some real trouble on their hands and they will have a tough time getting out of their longs without much pain."
So as to what the downside could be, Ron Lee at McCleskey Cotton said that "history tells us that a 6.0m-bale carryout," as the USDA is currently forecasting, "equals a price that begins with a 5".
However, that would not factor in any hurricane losses, nor "uncertainty" that Mr Lee also flagged.
"It's around every corner," he said, sticking by a forecast that New York futures will actually stay in the 66-76 cents-a-pound range.
"What if the Chinese decided the time was right to restock their reserve?"
That is not as outlandish a suggestion as it first appears, given that China has seemed focused on getting shot of its huge state inventories, built up thanks to a (now-scrapped) guaranteed pricing scheme.
Those auctions have gone far better than most investors had expected.
Louis Rose at Rose Commodity Group noted that "in China, rumours and conjecture continue to swirl regarding potential reserve purchases, both domestic and via imports, over the coming months.
"We think that these rumours have merit. Current data suggest that such is more than plausible.
"The reserve has sold nearly 14m bales of its reserve stockpile since March."
By Mike Verdin