April Live Cattle took one on the chin today and nearly went down for the count, missing out on a down limit move by .325. It settled at 126.65, just above support 126.625. Once support was breached at 128.10, long positions went into take profits mode and the selloff gained steam pushing price just past the critical support level and making the low at 126.325. A continuation to the downside could see price test support at 125.80 and then 124.30. The rising 100 DMA is at 123.218. Resistance is at 128.10. The negotiated cash market has been quiet so far, which has become typical for the trade. Cutout values continue to march higher with choice up 0.86 to 228.22 and select up 0.72 to 220.35 on moderate to fairly good demand and light offerings. There were only 97 loads and the choice/ select spread widened to 7.87. Slaughter is estimated to be at 120,000, bringing the early week total to 239,000.
For those interested I hold a weekly grain (with Sean Lusk) and livestock webinar on Thursday, March 14th 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.* *
Senior Market Strategist
Walsh Trading, Inc.
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.