Walsh Trading Daily Insights
January Feeder Cattle failed to overcome resistance at 182.70, making the high at 182.50 during the opening and then breaking down to close the gap created from the higher Monday open from Friday. The low of the session was right at Friday’s high (181.20) closing the gap. Bulls didn’t come back into the market and price spent the rest of the session consolidating. It settled at 181.675. The excitement didn’t last from the Cattle on Feed report and price couldn’t take advantage of Corn’s inability to rally, as it stayed in the lower of its range. With the Thanksgiving holiday looming, traders must be day-dreaming about eating turkey. A failure from the low could see price test support at 180.625 support. Support then comes in at the rising 100-DMA now at 180.30. If resistance at 182.70 is taken out, a test of resistance at 184.375 is likely. Resistance then comes in at 185.80.
February Live Cattle came within a tick of closing its Friday to Monday gap; making the low at 156.15 as lack of interest in the cash market (no trades so far) put a damper on the rally. The high was at 156.80 and settlement came in at 156.425. The Tuesday high was lower than Monday’s high as traders wait for something to happen in the cash market. Settlement was above the key level at 156.30 and if price can hold settlement, we could test the high and then move towards resistance at 157.25. Resistance then comes in at 159.075. A breakdown below the gap could see support tested at 155.10. Support then comes in at the rising 8-DMA now at 154.65.
Boxed beef cutouts were higher as choice cutouts increased 1.06 to 256.63 and select increased 0.95 to 234.18. The choice/ select spread widened and is at 22.45 and the load count was 157.
Tuesday’s estimated slaughter is 129,000, which is even with last week and above last year’s 124,000. The estimated total for the week (so Far) is 257,000, which is even with last week and above last year’s 246,000.
The USDA report LM_Ct131 states: Thus far for Tuesday negotiated cash trading has been at a standstill in the Southern Plains and Nebraska. In the Western Cornbelt negotiated cash trading has been mostly inactive on very light demand. Not enough purchase for an adequate market test. The latest established market in any feeding region was last week. In the Texas Panhandle live purchases traded at 150.00. In Kansas live purchases traded from 150.00-152.00. In Nebraska live purchases traded from 153.00-155.00 with dressed purchases at 242.00. In the Western Cornbelt, live purchases traded from 152.00- 155.00 and dressed purchases at 242.00. The USDA is indicating no cash trades for live cattle and on a dressed basis (so far).
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, December 01, 2022 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.
Walsh Trading, Inc. is registered as a Guaranteed Introducing Broker with the Commodity Futures Trading Commission and an NFA Member.
tested support at the
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 not 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.