The August Lean Hogs contract made an early attempt at a rally pushing past the 77.80 resistance level and making the session high at 78.325. The market collapsed and traded to the session low at 75.575. It settled at 76.075. It formed a bearish outside candlestick. A failure from settlement could see the 74.25 support level revisited. A failure from here could see price approach the 72.80 support level. If settlement holds then a re-test of resistance at 77.80 is possible. Resistance then comes in at 79.80. The Lean Hog Index declined and is at 72.82 as of July 3rd. The pork cutout index fell to 72.91as of July 8th.
August Live Cattle was unable to breakout above resistance at the 107.30 level. It reached the session high at 107.325 and fell back to support at 106.025. The low was 106.075. It settled at 106.15. If price fails at settlement a retest of the 104.85 – 104.20 support area is likely. A recovery will challenge resistance. The cash market was quiet. Boxed beef cutouts were lower as choice cutouts were down 0.21 to 217.46 and select was down 0.39 to 14.41 on moderate demand and moderate o heavy offerings. The choice/ select spread widened to 23.05 and the load count was 126. Slaughter was 120,000.
August Feeder Cattle also couldn’t stay above resistance. It tested the 138.95 resistance level making the high at 139.65. It drifted lower and made the low at 137.875. Settlement was at 138.90. If price fails at settlement, a test of support at 136.75 is likely. A breakout above 138.95 could see resistance tested at 140.775. The Feeder Cattle Index fell to 133.21as of July4th.
For those interested I hold a weekly grain (with Sean Lusk) and livestock webinar on Thursday, July 11th 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.