Live Cattle
The June Live Cattle contract continued on its downward spiral on Tuesday, April 3, 2018. It broke down below support (100.275) and made its way toward the 99.375 support level, making the low at 99.55. Rallies have been weak and the selling persistent. If this continues and Live Cattle breaks the 99.375 support level on Wednesday we could see support tested at 97.35. A recovery off the low could see resistance at 100.275 tested. On Tuesday negotiated cash trade and demand was light in Kansas with a few early sales reported at 118.00. Trade remains mostly inactive on light demand in all other feeding regions. Tuesday afternoon beef cutout values were steady on Choice and lower on Select on light to moderate demand and moderate to heavy offerings. Choice was down 0.12 at 219.68 and Select down 1.17 to close at 209.33 on 129 loads. The choice/ select spread widened to 10.35. The estimated cattle slaughter for Tuesday was reported at 119,000.
Feeder Cattle
The May Feeder Cattle contract broke down below the 131.25 support level and made yet another new low for the down move. The low was 130.80 and failing to hold this level could take price down to support at129.65. A bounce from the low could see price test resistance at132.075.
Lean Hogs
The June Lean Hogs contract once again broke down hard, taking out the 71.80 support level on its way to the session low at 70.90. It bounced off the low and settled at 71.65. The close below the 71.80 level sets up a possible test of support at 70.125 and then 68.975. If Lean Hogs holds support, a test of resistance at 72.875 is possible.
For those interested I hold a weekly grain (with Sean Lusk) and livestock webinar on Thursday, March 29th 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.