February Live Cattle
The February Live cattle market managed to somewhat keep it together and finished down .800 just off the lows of the session. They’re are a few noticeable technical developments as far as I see it. The process of top-down analysis calls for the study of longer term charts and working down to lower time-frames. By doing this ones has a better chance of not missing the forest through the trees. It appears to me that the futures have retreated to test a weekly trend-line. That being said a hold below 116.400 won’t look healthy. As a counter point to this observation we are below weekly inner support line on the backdrop of a shaven top opening (Monday). A full weekly ATR move (open to close) , should the high stay intact would suggest a follow thru to +- 114.500 which marks the .786 retracement level. To me a rise to +/- 117.300 could produce a good shorting opportunity. Stop/risk which is the most important part of the formula should be place above 118.500. With a projection of +/- 114.500 one could establish a favorable 1 to 3 risk reward setup.
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