June Lean Hogs traded down limit as China retaliates with new tariffs on US goods. Limits will expand for trade on Tuesday to 4.5 handles. Hogs settled at 86.675. Support comes in at 85.375 and then 83.325. The 50 DMA is at 86.97. A recovery could lead to a test of resistance at 88.325 and then 90.45.The market remains vulnerable to head lines and tweets.
June Live Cattle also reacted negatively to china’s retaliatory tariff news. It almost went down limit and made a new low for the down move at 109.60 and settled at 109.75. Continued pressure could see price test support at 108.65. Support then comes in at 107.30. If settlement holds, consolidation within the Monday range is likely.
August Feeder Cattle suffered big losses as it nearly went down limit, but the decline wasn’t enough to take out the May 9th low at 142.65. It made the session low just above it at 142.725 and settled at 143.10. Continued weakness could see price test the May 6th low at 142.25. A break down from here could see price test support at 140.775. If the May 6th low holds, price could consolidate within the Monday range.
For those interested I hold a weekly grain (with Sean Lusk) and livestock webinar on Thursday, May 16th 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.