Walsh Trading Daily Insights
June Lean Hogs opened higher, traded down to the session low at 104.725 and then rallied to the session high at 106.375. It settled at 106.025. The high is a new high for the up move and it was just below resistance at 106.85. If price can stay above settlement, a test of resistance at 106.85 is possible. Resistance then comes in at 107.925. A failure from settlement could see support challenged at 104.35. Support then comes in at 101.975. Hogs are at levels not seen since September 2014.
The Pork Cutout Index increased and is at 108.01 as of 3/29/2021.
The Lean Hog Index increased and is at 97.38 as of 3/26/2021.
Estimated Slaughter for Tuesday is 490,000 which is above last week’s 465,000 and below last year’s 491,000. Monday’s slaughter was revised lower to 483,000. The weekly estimated (so far) total is 973,000, which is above last week’s 946,000 and below last year’s 986,000.
May Feeder Cattle opened lower, tested support at 151.55 making the session low just above it at 151.65 then rallied to the session high at 153.475. The high is a new high for the up move and is just below resistance at 153.50. Resistance proved to be too much for price and it pulled back and settled at 152.20. Settlement was below the key level at 152.30 and it formed a Doji candlestick, indicating indecision in the market. If price can break out above 152.30, we could see a re-test of resistance at 153.50. Resistance then comes in at 154.25. A failure from settlement, could see price test support at 151.55. Support then comes in at 149.975.
The Feeder Cattle Index jumped and is at 139.75 as of 3/29/2021.
June Live Cattle did very little to inspire bulls on Tuesday, trading within Monday’s trading range forming an inside candlestick and settling near the 122.00 session low at 122.225. The high was at 123.00. Cash traded a limited amount at 116.10 in the Texas panhandle, so packers so far have the edge as hopes are for cash to jump another 2 handles this week and the light trade disappointed. Today’s trade essentially took place between resistance at 122.825 and support at 121.90. On a positive note, this is the third settlement above the rising 50 DMA (121.475). If price can trade above 122.825, a test of the Monday high is possible. If price can overtake the high a test of resistance at 124.30 is possible. A failure from 121.90 could see support tested at 120.80. Support then comes in at 119.375.
Boxed beef cutouts surged as choice cutouts soared 5.30 to 244.83 and select jumped 3.42 to 235.92. The choice/ select spread widened to 8.91 and the load count was 149.
Tuesday’s estimated slaughter is 120,000, which is above last week’s 117,000 and last year’s 119,000. The total for the week (so far) is 239,000, which is above last week’s 233,000 and last year’s 238,000.
The USDA report LM_Ct131 states: Thus far for Tuesday negotiated cash trading in the Texas Panhandle has been limited on light demand. A few live purchases traded at 116.11. However, not enough for a full market trend. In Kansa, Northern Plains and Western Cornbelt negotiated cash trading has been at a standstill. Last week in the Southern Plains live purchases traded at 115.00. For the prior week in the Northern Plains live purchases traded mostly at 116.00 and dressed purchases, in Nebraska, traded at 185.00. For the previous week in the Western Cornbelt live purchases traded from 115.00-117.00 and dressed purchases traded at mostly at 185.00.
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 Thursday, April 1, 2021 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.
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