The December Lean Hogs traded higher after holding support at 64.25 making the low just below it at 64.125. It traded to the high at 66.00, settling just below it at 65.65. It formed an inside candlestick, consolidating within Friday’s range. It stalled below resistance at 66.55 and the 50 DMA at 66.50. A rally above resistance could see price test the 67.80 resistance level. a breakdown from settlement could see a retest of support at 64.25 and then 63.325 and the October 8 low at 63.075. The Lean Hog index declined and is at 65.09 as of 10/24/2019. The Pork Cutout Index dipped and is at 76.08 as of 10/25/2019.
December Live Cattle rallied to a new high for the up move, reaching 116.775 at the end of the day. It settled at 116.60, just above the 116.55 resistance level. If cattle can hold 116.55, a test of resistance at 117.80 is possible. A failure from the high could see price pull back into the middle of Friday’s (116.226 – 114.625) trading range. The cash market was at a standstill. Boxed beef cutouts were higher with choice cutouts up 2.46 to 227.90 and select up 0.92 to 200.76 on good demand and light offerings. The choice/ select spread widened to 27.14 and the load count was 81. Slaughter was 118,000.
January Feeder Cattle consolidated within Friday’s trading range. It formed an inside candle stick with a tight range (141.975 – 141.025). It settled at 141.60. It is stuck between resistance at 142.40 and support at 140.775. A breakout above 142.40 could see resistance at 143.50 and then 144.25 tested. Break down from 140.775 could see support at 138.95 tested. Support is bolstered by the 50 and 100 DMAs. The 50 and 100 are touching at 138.33. The 50 could cross above the 100 on Tuesday. The Feeder Cattle Index declined and is at 114.35 as of October 25th.
For those interested I hold a weekly grain (with Sean Lusk) and livestock webinar on Thursday, October 31st 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.