For those interested I hold a weekly livestock webinar on Tuesdays and my next webinar will be Tuesday, February 04, 2025, at 3:15 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.
March Feeder Cattle opened higher and rallied to the high at 276.75. The rally stalled at around the 38.2% retracement of Wednesday’s breakdown which formed a Bearish Engulfing candle. It was also just below resistance at 277.25. Price then turned south and traded to the session low at 273.20. The breakdown took price below support at the 8-DMA now at 274.30 and stopped at the rising 13-DMA now at 272.05. It consolidated near the low and settled at 273.20. I think profit taking is taking place in front of the Cattle Inventory report after the futures have made new highs on continuous basis and we have month end on Friday in addition to the report. The engulfing candle at the all-time high futures price may also be causing the profit taking. Bearish Engulfing candles at all-time highs could lead to a bigger decline if we can break down below the rising 13-DMA. A failure below the 13-DMA could see price test support at the rising 21-DMA now at 269.85. Futures are giving way despite another new all-time high in the Feeder Cattle Index. If Feeders hold settlement, we could test resistance at 274.65. Resistance then comes in at 277.25. We’ll see!…
The Feeder Cattle Index increased and is at 281.07 as of 01/29/2025.
April Live Cattle opened higher and made the session high at 205.30. It stopped just shy of resistance at 205.55 and broke down to the low at 200.825. It consolidated near the low and settled at 201.50. The break down stalled just below support at 200.90 and it settled below support at the rising 8-DMA 202.35. The break down looked like some profit taking in front of month end and the Cattle Inventory report which comes out after the close on Friday. The cash market looked mostly steady with last week but it looks like the South was trading mostly at its high prices from last week, above its average for last week. This could actually increase cash prices for the South if trade continues that way. Cutouts have faltered this week and (see below) actually crashed on Thursday. This keeps the onus on the packing industry and many are wondering what is going on in that sector as they pay up for cash, slow down the slaughter and yet can’t get the retail industry to pay up for beef. They are in a bad way as they have to compete for cattle instead of sitting back and waiting for the producer to cave. They are in a bad way as they can’t sit back and see the retailer pay up for beef . Quite the opposite from when they were telling both parties you have to go my way or the highway. They are the ones that now seem to be up the creek without a paddle. The inventory report is out after Friday’s close and we may continue to see more profit taking as tariffs are on the table in addition to the report for Saturday and traders will likely wonder how it will affect the livestock markets and prices if the countries involved don’t comply with the President’s directives. We’ll see!… If price can’t hold settlement, it could test support at 200.90. The rising 13-DMA is nearby at 200.45. Support then comes in at 199.10 and then the rising 21-DMA now at 198.40. If settlement holds, we could see price the rising 8-DMA and then resistance at 203.50.
Boxed beef cutouts were lower as choice cutouts dropped 3.06 to 327.48 and select collapsed 4.77 to 315.90. The choice/ select spread widened and is 11.58 and the load count was 138.
Thursday’s estimated slaughter is 122,000, which is below last week’s 123,000 and last year’s 126,814. The estimated total for the week(so far) is 484,000, which is below last week’s 486,000 and last year’s 500,942.
The USDA report LM_Ct131 states: So far for Thursday in the Southern Plains, negotiated cash trading has been moderate on very good demand. Compared to last week live FOB purchases traded 6.00-7.00 higher at 208.00. A few live FOB purchases in Kansas traded up to 209.00. In Nebraska and the Western Cornbelt, negotiated cash trading has been slow with moderate demand. In Nebraska, a few dressed delivered purchases traded at 330.00. In the Western Cornbelt, a few live FOB purchases traded at 210.00. However, not enough purchases in either of these regions for a full market trend. Last week in Nebraska and the Western Cornbelt, live FOB purchases traded from 210.00-212.00. Dressed delivered purchases traded from 328.00-330.00 in Nebraska and 330.00 in the Western Cornbelt.
The USDA is indicating cash trades for live cattle from 202.00 – 212.00 and from 325.00 – 330.00 on a dressed basis (so far).
**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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