Live Cattle
On Wednesday June 27, 2018 the August Live Cattle contract opened at 102.50, traded to the early high at 102.925 then grinded lower, trading to the low at 101.65, just above support at 101.625. An end of day rally took price to a new high for the session at 102.95. This is just below the 103.00 resistance level. It settled at 102.725. A breakdown below settlement could see price re-test support at 101.625 and then trendline support at 101.35. Support then comes in at the June 15 low at 100.40 and then 100.275. A recovery off of settlement could see price move towards the 104.20 – 104.85 resistance band. Thus far on Wednesday negotiated cash trade in Kansas is moderate on good demand with live sales 2.00 lower than last week at 106.00. In Nebraska, trade is light on moderate demand with dressed sales at 170.00. Wednesday afternoon boxed beef cutout values were values weak to lower on light demand and light to moderate offerings. Choice was down 1.53 at 215.30 with Select down 0.69 to close at 200.88 on 131 loads. The choice/ Select spread narrowed to 14.42. The hide and offal value from a typical slaughter steer for today was estimated at 9.58 per cwt live, down 0.09 when compared to Tuesday’s value. Estimated cattle slaughter for today is 119,000, last week 119,000 and a year ago 119,000.
Feeder Cattle
The August Feeder Cattle contract opened at 146.10, up ticked to the session high at 146.125 and then made its way lower testing the 145.05 support level and the 50 DMA (144.90), making the low at the 50 DMA. It recovered and a late day rally took price up to test the high, reaching 145.95 before settling at 145.775. A rally above settlement could test resistance at 146.20 and then the 200 DMA (147.05) and 147.35. Resistance then comes in at 148.425. A breakdown below settlement could see price test support at 145.05 and then 144.20. The 100 DMA (143.60) is next and then 143.50 and 142.40.
Lean Hogs
The August Lean Hogs contract opened at 74.825 and spent the session consolidating (75.25 – 74.30) within the Tuesday range (75.65 – 73.60). It settled at 75.05. A continuation higher could see price test the 75.625 resistance level again and then 76.225. A failure from settlement could see Hogs test the 74.125 support level and then the 100 DMA at 73.975. Support then comes in at 72.875 and then 71.80.
For those interested I hold a weekly grain (with Sean Lusk) and livestock webinar on Thursday, June 28th at 3:00 pm. It is free for anyone who wants to sign up and the link for sign up is below. If you cannot attend live a recording will be sent to your email upon completion of the webinar.
**Call me for a free consultation for a marketing plan regarding your livestock needs.* *
Ben DiCostanzo
Senior Market Strategist
Walsh Trading, Inc.
Direct: 312.957.4163
888.391.7894
Fax: 312.256.0109
www.walshtrading.com
RISK DISCLOSURE: THERE IS A SUBSTANTIAL RISK OF LOSS IN FUTURES AND OPTIONS TRADING. THIS REPORT IS A SOLICITATION FOR ENTERING A DERIVATIVES TRANSACTION AND ALL TRANSACTIONS INCLUDE A SUBSTANTIAL RISK OF LOSS. THE USE OF A STOP-LOSS ORDER MAY NOT NECESSARILY LIMIT YOUR LOSS TO THE INTENDED AMOUNT. WHILE CURRENT EVENTS, MARKET ANNOUNCEMENTS AND SEASONAL FACTORS ARE TYPICALLY BUILT INTO FUTURES PRICES, A MOVEMENT IN THE CASH MARKET WOULD NOT NECESSARILY MOVE IN TANDEM WITH THE RELATED FUTURES AND OPTIONS CONTRACTS.