Walsh Trading Daily Insights
Commentary
November Feeder Cattle opened higher and broke down to the session low at 174.40. This is just above the recent low at 174.225 and bulls took over and price rallied the rest of the session to the high at 177.625. It settled near the high at 177.325. Feeder Cattle is in a trading range from 178.35 to 174.225 as traders await the fall run of calves. The rally took price back to the rising 100-DMA now at 177.50. Settlement was below it so it is still acting as strong resistance. Support then comes in at 173.325. If price rallies past the 100-DMA, a test of resistance at 178.95 is possible. A breakdown from settlement could see price revisit support at 175.70 and then move toward the low end of the range.
The Feeder Cattle Index dipped and is at 175.58 as of 10/04/2022.
December Live Cattle opened lower and traded down to the session low at 146.90. The breakdown tested support at the 21-DMA now at 147.175 and 146.825. The strong support turned price higher and it rallied to the high at 148.425. The high was just below the rising 13-DMA now at 148.45 and this set back cattle as it pulled back and settled at 147.925. Cash trading took place and so far, it looks like we are seeing steady prices for both live and dressed cattle. If settlement holds, we could re-test resistance at the 13-DMA. A break out above the high should face resistance at 149.375. A break down settlement could see support tested at the 21-DMA. Support then comes in at 146.825 and then 145.225.
Boxed beef cutouts were lower as choice cutouts decreased 0.98 to 247.06 and select dropped 2.69 to 219.22. The choice/ select spread widened and is at 27.84 and the load count was 169.
Wednesday’s estimated slaughter is 128,000, which is above last week’s 127,000 and last year’s 121,000. The estimated total for the week (so far) is 383,000, which is above last week’s 380,000 and last year’s 363,000.
The USDA report LM_Ct131 states: Thus far for Wednesday negotiated cash trading has been limited on light demand in the Texas Panhandle, Nebraska, and the Western Cornbelt. Not enough purchases in these regions for a market trend. Negotiated cash trading has been at a standstill in Kansas. Last week in the Southern Plains live purchases traded at 143.00. In Nebraska and the Western Cornbelt, live and dressed purchases traded at 145.00 and 228.00, respectively.
The USDA is indicating cash trades for live cattle from 143.00 – 148.00 and 228.00 – 230.00 on a dressed basis (so far).
For those interested I hold a weekly grain (with Sean Lusk) and livestock webinar on Thursdays (except holiday weeks) and our next webinar will be on Thursday, October 6, 2022 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
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