Cotton’s Bullish Breakout Nears Confirmation: Will Buyers Hold?

Today, we focus on Cotton, which is experiencing a strong bullish move, having already broken one key resistance and now testing another critical level. If price action confirms a breakout, this could signal a major shift in trend, opening the door for a long-term buying opportunity.

The first key level, the green downtrend line, had been guiding Cotton’s decline since September 2024. This resistance was broken on February 11, and yesterday’s successful retest of this level as support provided further bullish confirmation. The price bounced off this area, reinforcing the idea that sellers are losing control, and that buyers are gaining momentum.

Currently, Cotton is testing the blue downtrend line, which has acted as resistance since December 2024. This trendline was already tested on February 12, and now the price is making another attempt to break above it. A daily close above this resistance would be a strong confirmation of a bullish breakout, as it would mean that two major downtrend lines have been broken, providing a clear long-term buy signal.

On the other hand, if Cotton fails to hold above these levels and reverses back below the green downtrend line, it would indicate a false breakout, signaling a potential return to bearish pressure. While this scenario remains possible, the bullish momentum appears stronger at this stage.

Traders should closely monitor today’s closing price, as clearing the blue resistance line could mark the beginning of a larger uptrend, with Cotton potentially targeting higher price levels in the coming sessions.

Source: https://www.axiory.com/analytics/technical-analysis/cotton-s-bullish-breakout-nears-confirmation-will