Cash trade higher on Friday with cattle sold on a live basis between 123.00 and 126.00 depending on the region. Dressed sales took place between 198.00 and 200.00. April futures responded by inching higher as they rallied to 127.725 and settling at 127.00. Resistance remains at 128.10 and the Thursday high at 129.475. A failure from settlement could see support revisited at 125.80. Cutouts rebounded from last week’s decline to show choice up 3.39 to 217.65 and select up 0.26 to 213.41 on moderate to fairly good demand and light to moderate offerings. The choice/ select spread jumped to 4.24. March Feeder Cattle had a strong rally as it tested the 50 DMA up at 145.103 making the high at 145.275. It pulled back and settled at 144.225. A rally above the 50 DMA could see price test resistance at 146.20. Resistance then comes in at 147.30. Trading below settlement could see price make its way to support at 143.50 and then 142.40. April Lean Hogs went up limit and settled near the limit price at 63.05. The 200 DMA is at 63.354 and the 50 DMA is just above at 63.653 and could restrain Hogs. If price can break out above these levels a rally to resistance at 64.80 is possible. If the moving averages hold then consolidation within the Monday range is possible.
For those interested I hold a weekly grain (with Sean Lusk) and livestock webinar on Friday, February 7th 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.