Livestock Report

Ben DiCostanzo General Commentary Leave a Comment

Walsh Trading Daily Insights

Commentary

July Lean Hogs rallied early in the trading session, nearing resistance at the 100 DMA on the continuous chart (61.58), making the high at 61.175. Selling came in and pressed price lower and it settled in the lower end of the trading range at 59 .825. Support on Thursday is at 58.25, 57.025 and then 56.10. Resistance is at 59.825, 61.80 and then 63.325. Estimated Slaughter for Wednesday is at 415,000, this is above last week’s 397,000. This is below last year’s slaughter at 461,000. The Pork Cutout Index fell and is at 97.85 as of 5/25/2020. The Lean Hog Index dropped and is at 62.30 as of 5/22/2020. August Feeder Cattle gap opened higher, stalled near the 200 DMA (135.69) on the continuous chart, making the high at 135.00 and then pulled back to close the gap. It bounced and settled in the middle of the trading range at 134.025. Support is at 133.50, 132.075, 131.10 and then 129.65. Resistance is at 134.25, 135.60 and 136.75. The Feeder Cattle Index decreased and is at 126.11 as of 5/26/2020. The 5/25/2020 index was at 126.44. August Live Cattle rallied and settled strong at 100.725. This near the session high at 100.85. Settlement is above the high on May 18th at 100.00. The high is a new high for the up move. Support is at 99.375, 97.075 and then 96.10. Resistance is at 101.625 and then 103.00. Boxed beef cutouts continued its decline from record levels. Choice cutouts dropped 7.72 to 377.77 and select fell 9.82 to 350.20. The choice/ select spread widened to 27.57 and the load count was 175. Slaughter levels continue to recover from its lows and is getting closer to normal levels. Wednesday’s estimated slaughter is 110,000, above last week’s 101,000, but still below last year’s 122,000. The USDA report LM_Ct131 states: So far for Wednesday in the Southern Plains negotiated cash trading has been limited on light demand. In Kansas a few live trades moved at 120.00. However, not enough for a full market trend. Last week in Kansas live trades moved from 115.00 to 120.00. For the prior week in the Texas Panhandle the bulk of live trades moved at 120.00. Thus far for Wednesday in Nebraska and Western Cornbelt negotiated cash trading has been slow with moderate demand. In Nebraska dressed trades moved from 178.00 to 190.00, thus far for the week the bulk have moved from 180.00 to 190.00. Not enough live trades on Wednesday for a market trend. The last reported live trade market was on Tuesday with trades from 112.00 to 115.00. In the Western Cornbelt for Wednesday, when compared to the prior week, the bulk of live trades moved steady to 1.00 higher at 115.00 and dressed trades, when compared to last week, moved steady to 2.00 lower from 178.00 to 190.00.

Trade Suggestion(s)

Risk/Reward

Futures N/A

Options N/A

For those interested I hold a weekly grain (with Sean Lusk) and livestock webinar on Thursdays (except holiday weeks’) and our next webinar will be on Friday, May 29, 2020 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.

Sign Up Now

**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

bdicostanzo@walshtrading.com

www.walshtrading.com

Walsh Trading, Inc. is registered as a Guaranteed Introducing Broker with the Commodity Futures Trading Commission and an NFA Member.

Futures and options trading involves substantial risk and is not suitable for all investors. Therefore, individuals should carefully consider their financial condition in deciding whether to trade. Option traders should be aware that the exercise of a long option will result in a futures position. The valuation of futures and options may fluctuate, and as a result, clients may lose more than their original investment. The information contained on this site is the opinion of the writer or was obtained from sources cited within the commentary. The impact on market prices due to seasonal or market cycles and current news events may already be reflected in market prices. PAST PERFORMANCE IS NOT NECESSARILY INDICATIVE OF FUTURE RESULTS.

All information, communications, publications, and reports, including this specific material, used and distributed by Walsh Trading, Inc. (WTI) shall be construed as a solicitation for entering into a derivatives transaction. WTI does not distribute research reports, employ research analysts, or maintain a research department as defined in CFTC Regulation 1.71.

Leave a Reply

Your email address will not be published. Required fields are marked *