The December Lean Hogs contract tested support at 63.325 this morning making the low just below it at 63.075. An impressive rally erupted and price rallied the remainder of the session nearly going up the expanded limit for the day. The high of the session was 68.625 which is right at resistance at the 8 (68.578) and 13 (68.782) DMAs. Hogs pulled back at the close and settled at 67.40. It formed a bullish engulfing pattern and a breakout above the high could see price test resistance at 69.80 and then move towards resistance at 71.325 -71.85. A failure from settlement could see price consolidate within the Tuesday range. The Lean Hog index is at 59.22 as of 10/4/2019. The Pork Cutout Index continued its climb and is at 75.45 as of 10/7/2019.
December Live Cattle continues to hover around the 110.80 resistance level. It hasn’t been able to break out to the 112.35 resistance level and the trading ranges continue to be small. It settled at 110.85. A failure from 110.80 could see price test support at 108.65. The cash market was at a standstill. Boxed beef cutouts were higher with choice cutouts up 2.51 to 213.60 and select up 1.15 to 187.06 on moderate demand and light offerings. The choice/ select spread widened to 26.54 and the load count was 125. Slaughter was 117,000.
November Feeder Cattle tested support at 140.775 making its low at 140.525. It grinded higher and made its high at 141.75. It is also battling resistance at the 8 (141.65) and 13 (141.56) DMAs. It settled at 141.25. A breakout above the high could see resistance tested at 142.50 and then 143.50. Resistance then comes in at 144.25. A failure from settlement could see price revisit the low. Support then comes in at 138.95. The Feeder Cattle Index was higher and is at 144.03 as of October 4th.
For those interested I hold a weekly grain (with Sean Lusk) and livestock webinar on Thursday, October 10th 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.comRISK 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