Live Cattle
On Friday June 22, 2018 the August Live Cattle contract opened at 105.85, traded to the low at 105.525 and then traded up to the session high at 106.60. It settled at1 05.90. It was a quiet session with traders waiting on the Cattle on Feed Report. A rally from the high could see price test resistance at 107.35 then 108.65. A break down below the low could see price test support at 104.85 and then 104.20. Support then comes in at 103.00. Thus far on Friday negotiated cash trade in Kansas has been light on light demand with live sales from 108.00 to 109.00. In Nebraska, trade has been light on light to moderate demand with live sales from 108.00 to 109.00 and dressed sales from 172.00 to 173.00. In Colorado trade has been light on light demand with live sales from 108.00-109.00. The Cattle on Feed report showed cattle on feed June 1st at 104.1 percent, May placements at 100.2 percent and May marketings at 105.4 percent. Friday afternoon boxed beef cutout values were steady to firm on light to moderate demand and light offerings. Choice was down 0.25 at 217.16 with Select up 0.41 to close at 202.02 on 93 loads. The choice/ select spread narrowed to 15.14. The hide and offal value from typical fed cattle for today was estimated at 9.67 per cwt live, down 0.03 from Thursday’s value. The estimated cattle slaughter for Friday was at 119,000 head with 67,000 on Saturday and a week to date estimate of 664,000.
Feeder Cattle
The August Feeder Cattle contract opened at 148.475, traded lower, touched the 8 DMA at 147.875 (session low), then rallied the remainder of the day and making the high at 149.325 at the end of the session. It settled at 149.20. A break down below the low could see price test support at the 200 DMA (147.075). Support then comes in at the 21 DMA (146.725), 146.20 and then145.05. A rally from the high could see resistance tested at 149.975, 150.90 and then the 151.95 high from February 5th. Resistance then comes in at 152.30.
Lean Hogs
The August Lean Hogs contract opened at the session high (75.475), traded down to the low at 74.525 and meandered higher equaling the high at the end of the day. It settled at 75.375. It formed an inside candle and a rally above the high could test resistance at 75.625, 76.225 and then the 50 DMA at 76.85. A breakdown from settlement could retest the Friday low and then support at 74.125 and then the 100 DMA (73.95). Support then comes in at 72.875.
For those interested I hold a weekly grain (with Sean Lusk) and livestock webinar on Thursday, June 28th 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.