The October Lean Hogs contract broke out above the 80.40 resistance level, nearly going limit up and making the high of the day at 81.875. It settled at 81.80. A failure from settlement could see price test support at 80.40. Support then comes in at 79.80. A rally above the high could see price test resistance at 83.325. The Lean Hog Index surged and is at 73.27 as of July 19th. The pork cutout index jumped to 77.27 as of July 22nd.
October Live Cattle continued to grind higher and made the session high high at 110.00. This is a new high for the up move for the lead contract. The low was 108.90 which is just above support at 108.65. It settled near the high at 109.875. If cattle can rally above the high, a test of resistance up at 110.80 is possible. A failure from settlement could see price revisit the 108.65 support level. The cash market was quiet. Boxed beef cutouts were higher as choice cutouts were up 0.46 to 213.78 and select was up 0.12 to 189.71on moderate to good demand and moderate offerings. The choice/ select spread widened to 24.07 and the load count was 131. Slaughter was 122,000.
August Feeder Cattle consolidated Monday’s gain, opening near Monday’s high (142.325), equaling it and then trading down to the middle of its range. It made the low at 140.925 which is just above support at 140.775. It reversed course and made a new high at the end of the day at 142.35. This is just below resistance at 142.40. It settled just below it at 142.20. A rally above the high could see price resistance143.50. The high for the up move is at 143.75. A break down below settlement could see price retest support down at 140.775. The Feeder Cattle Index dropped to 136.94 as of July 22nd.
For those interested I hold a weekly grain (with Sean Lusk) and livestock webinar on Thursday, July 25th 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.