The October Lean Hogs contract rallied past resistance at 67.80 to the session high at 68.00. It couldn’t sustain the rally and broke down and traded to the session low at 65.925. It settled near the low at 66.30. The October contract was the weakest contract in the Hog arena as deferred months settled higher on the day. A rebound from settlement could see price test resistance at 67.80 and then 69.80. A failure from settlement could see price fall back to support at 64.80. The Lean Hog index continues to fall and is at 66.57 as of 9/3/2019. The Pork Cutout Index fell and is at 72.70 as of 9/4/2019.
October Live Cattle collapsed and made a new low at 97.175. This is just above the 97.075 support level. It settled at 97.875. It settled below the 98.10 (now) resistance level and will help decide trade for Friday. A rally above 98.10 could see price test resistance at 99.375. Resistance then comes in at 100.275. The cash market traded at 100.00 in both Texas and Kansas. Boxed beef cutouts declined with choice cutouts down 1.23 to 229.42 and select down 4.48 to 204.47 on light demand and heavy offerings. The choice/ select spread widened to 24.95 and the load count was 150. Slaughter was 116,000.
October Feeder Cattle broke down and traded to the session low at 130.975. It stopped just below the 131.10 support level and above the Friday low of 130.20. It recovered and settled above the 132.075 support level at 132.325. If settlement holds then a re-test of resistance at 133.50 is possible. Resistance then comes in at 134.25 and then 135.60. A failure from settlement could see price re-test the 132.075 support level and then the Friday low at 130.20. Support then comes in at 129.65. The Feeder Cattle Index dipped to 138.43 as of September 4th.
For those interested I hold a weekly grain (with Sean Lusk) and livestock webinar on Friday, September 6th 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.