Live Cattle
The August Live Cattle opened (115.80) lower from Monday’s settlement (116.10) on Tuesday, June 20, 2017 and raced down to the low of the day at 113.65. The low came in just above the 200 DMA (113.25) support level and buyers came in at this level and took price higher. By the end of the session Live Cattle made a new high and left a long shadow, forming a Hammer candlestick. This is a bullish formation as we have had a 14 handle decline from the 127.65 high on June 6 to today’s low. If the August contract can rally above the high (116.425) a rally to the 100 DMA (117.925) is possible. If the low holds, retracement levels come in at the 38.2% retracement level at 118.99, the 50% retracement level at 120.65 and the 61.8% retracement level at 122.30. Live Cattle is in a short-term down trend as a lower high and now a lower low is in place on the continuous chart. A failure to hold above the 116.425 high could lead to a retest of support at the 200 DMA. Wednesday could see some cash trading as cash has been quiet so far this week and the fedcattleexchange online auction should be up and running as the exchange is reverting back to its old platform. Boxed beef cutout values were lower this afternoon on light demand and light to moderate offerings. Choice cutouts were down $2.47 to $246.99 and select down $1.48 to $219.88 on 129 loads. The choice/ select spread is at $27.11. Tuesday’s estimated slaughter is 117,000, even with a week ago and above last year’s 112,000.
For those interested I hold a weekly livestock webinar on Friday, June 23 at 3:00pm. 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.