December Live Cattle
The cattle market peaked higher today topping out at 116.900 before easing slightly to settle at 116.200. A few things of note are the fact that we have closed a weekly gap from the selloff in the third week of July at 116.700 and have fulfilled the weekly ATR (average true range) estimate of roughly 4.5 pts. What this means to me is that the market perhaps has limited room on the upside for the weeks final session. On the daily charts there remains an opened window (gap) at 118.00 which would be the most likely level of contention. Measuring the most bullish weekly moves over the last 11 months we are very close to reaching the average reading of 5.2 which would put us right at that inner daily level of 118. Underneath support comes in between 115.2 and 114.7. Any pullback to this level would most likely be a non-impulsive intermediate (iv) wave correction. A close below 114.30 would change my opinion as my current view of wave structure breaks down.
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