Cattle markets showed a lot of strength this morning with the February contract trading as high as 158.825 but almost immediately sold off after it failed to break through the 159-resistance level. Mid-morning cash trades reported were $160, according to the USDA’s Morning national Slaughter Cattle Review, so that should lend support to the market for tomorrow. In my opinion, with the strong start in the cash trade, I still believe the trend is higher and remains bullish going forward unless there are weaker cash trades later in the week. If there is another rejection of the 159 highs, I would then become hesitant to believe that $161 is the next price target like I had stated in previous posts. Total volume today was about the same as the amount traded yesterday.
Packer demand for cash cattle is expected to be greater this week. With Choice beef prices surging $3.15 on Monday and the Choice/Select spread at a strong $26.54, signs point toward packers paying higher prices for cash cattle than last week’s $157.74 average. February live cattle futures posted a bullish reversal on Monday, which puts the contract high at $159.175 as bulls’ near-term target. Monday’s low at $156.525 is near-term support.
FEB Cattle
**Call me for a free consultation for a marketing plan regarding your livestock needs.**
Peter McGinn
Account Executive
Walsh Trading, Inc.
Direct: 312-985-0931
Toll Free: 800-556-9411
Walsh Trading, Inc. is registered as a Guaranteed Introducing Broker with the Commodity Futures Trading Commission and an NFA Member.
Futures and options trading involves substantial risk and is not suitable for all investors. Therefore, individuals should carefully consider their financial condition in deciding whether to trade. Option traders should be aware that the exercise of a long option will result in a futures position. The valuation of futures and options may fluctuate, and as a result, clients may lose more than their original investment. The information contained on this site is the opinion of the writer or was obtained from sources cited within the commentary. The impact on market prices due to seasonal or market cycles and current news events may already be reflected in market prices. PAST PERFORMANCE IS NOT NECESSARILY INDICATIVE OF FUTURE RESULTS.
All information, communications, publications, and reports, including this specific material, used and distributed by Walsh Trading, Inc. (“WTI”) shall be construed as a solicitation for entering into a derivatives transaction. WTI does not distribute research