(please see my analyses publised today on corn , wheat , soybeans and Oil today.)
So what about Cotton?
Basically it is still trending. Last time I was looking for a possible long entry was when it traded ard 63. I was waiting for a Kumo breakout, but that did not hapen and Price turned down again. However the trend momentum is not strong, is below 20 and DMI lines were not able to widen significantly. As time goes by it seems Cotton is building some form of , while there is still chance for a double positive divergence to develop. These are the reasons I started to focus on Cotton again.
On this chart I placed the March/2015 contract, but if you replace it with "CT2!" (second continous contract) and you zoom it out on a weekly or monthly chart, you can see ard 59 there is a very interesting long term key suppor/resistance level.
Regarding positionning, I can assure you, Cotton is one of the biggest short among mkt players. During last 10 days Price dip the turnover was continously decreasing. First of all it would be important to see a pickup in turnover on green candle days. That could be an early signal for short covering.
All in all I think if the momentum can not re-accelerate here, this 58-59 key level will hold, and finally Price will move up again (what can not go lower, will go up). reversal of course can take place only if it trades back above 62, breaks the (the ) and later the Kumo as well. Whenever that happens, given the short positioning the move will be very agressive and sharp.