NEW YORK - Most U.S. cotton futures settled higher on Tuesday, rallying with other commodities, especially crude oil, and the euro as investors found relief from European officials' agreement to a debt bailout deal for Greece.

Euro zone finance ministers agreed to a 130 billion-euro ($172 billion) rescue package for Greece to avert an impending default, after forcing Athens to commit to unpopular cuts and private bondholders to take bigger losses.

The complex deal wrought in overnight negotiations gives breathing room to investors seeking to add risk and arrived as the U.S. cotton market reopened with other commodities after being closed Monday for the U.S. Presidents Day holiday.

The euro rose to nearly two-week highs against the dollar on investor relief from the Greek debt plan, which helps cotton firm in overseas markets.

"The Greek financial bailout went through and financial markets are experiencing a relief rally," John Flanagan, broker at Flanagan Trading Corp in North Carolina.

New benchmark May futures on ICE Futures U.S. closed at 92.97 per lb, up 0.32 cent. Despite the buying interest, May futures established an inside range for the day, meaning a higher low and a lower high, moving from 92.46 to 93.79.

The session low continued to hold within the parameters of an uptrend line that began at the Dec. 14 bottom at 84.23.

May volume came to a robust 12,719 lots shortly after the exchange session finished.

March cotton edged lower heading into the close, finishing down 0.20 cent at 91.25 cents per lb. It was the lowest close since Feb. 10.

The trading range ran from 91.12 to 92.24 per lb. March volume came to 7,467 lots, as more players exited their positions ahead of the delivery period for the contract.

The nearby March contract also lost ground to players exiting their positions as the Feb. 23 delivery date approaches.

"Today, the only sellers were from the final liquidations of March contracts before delivery," said Mike Stevens, an independent cotton analyst in Mandeville, Louisiana.

As of Feb. 17, May's open interest rose to 88,457 lots and March dropped to 12,475 lots first notice day for March approaches on Feb. 23.

A surge in crude oil prices to their highest settlement in nine months, also gave cotton a psychological boost.

"Psychological help, because most synthetic fibers are made from petroleum products," said Stevens.

Synthetic fibers compete with cotton in fabric content.

Down the road, some analysts think cotton may fall, with many supply/demand factors arguing for a bearish turn in prices.

In China, a think tank said the country's cotton prices may face pressure at the end of March once the government concludes its purchases of the crop, citing weak demand.

India's cotton prices are expected to fall this week on a drop in overseas demand as buying from China has slowed and demand from Bangladesh suffered as textile mills there are facing financial problems. China and Bangladesh are the top two buyers of Indian cotton.

Open interest in cotton, an indicator of investor exposure, declined by 3,792 lots to 178,666 lots as of Feb. 17 ICE Futures U.S. data showed. On Friday, volume rose by 4,169 lots to 24,163 lots from Thursday's tally, exchange data showed. (Reporting by Carole Vaporean; Editing by Lisa Shumaker)