Live Cattle
The October Live Cattle contract tested the 106.00 support level on Tuesday, August 15, 2017, trading down to a new low for the move at 105.75. Support held and Live Cattle rallied from the low. The market closed above resistance (108.675). A rally above the session high (109.575) could lead to a test of resistance at 110.80. A breakdown 107.575 could see a test of the lows. The negotiated cash market traded at 110 for live cattle and 175.00 for dressed on Monday. The futures rallied today despite this news. The fedcattleexchange auction is on Wednesday morning there is 1,164 head for sale. Thursday morning boxed beef cutout values were higher on Choice and lower on Select. Choice was up 0.20 at 199.12 and Select down 0.51 to 195.93 on 65 loads. The choice/ select spread widened to 3.19. The estimated cattle slaughter for Tuesday was reported at 119,000.
Feeder Cattle
The September Feeder Cattle contract rallied above the 143.50 resistance level early in the session and then took nearly going limit up on the day. It reached a high of 147.225 and ended the session above (146.40) the 146.025 resistance level. A rally above the high could lead to a test of resistance at 149.975. A failure form the 146.025 level could lead to a retest of support at 144.65 and then 143.50.
Lean Hogs
The October Lean Hogs contract broke out above the 200 DMA (69.325) and the 69.90 resistance level. It reached a high of 70.90 and was able to close above the two resistance levels. There is resistance just above the high at 71.30. A rally above here could lead to a test of the 72.875 resistance level. Trading below the low could see a test of support at 67.90.
For those interested I hold a weekly livestock webinar on Thursday, August 17 at 3:00pm. 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.