Live Cattle
The December Live Cattle contract rallied on Wednesday, November 1, 2017. It rallied past resistance at 125.55, trading up just shy of the 127.15 resistance level, making the high at 126.875. It ended the session at 126.675. There is pretty good resistance from 127.15 to 128.30. Price could stall in this area and come back and test support at 125.55 and then 124.70. Breaking out above 128.30 could lead to a test of resistance at 129.35. The negotiated cash market was quiet on Tuesday. The fedcattleexchange.com auction took place with 1,515 cattle for sale. Packers only reacted to minimum bids from 120.00 and lower. The only accepted trade was at 120.00. Wednesday afternoon boxed beef cutout values higher on Choice and lower for Select on moderate to good demand and moderate to heavy offerings. Choice was up 0.95 to 207.39 and Select was down 0.19 to 193.71 on 139 loads. The choice/ select spread widened to a plus 13.68. The estimated cattle slaughter for Wednesday was reported at 116,000.
Feeder Cattle
The January Feeder Cattle contract rallied past the 159.975 resistance level and then took out the high from June 6 (160.90) on its way to making a new high for the up move at 161.25. It pulled back from the high and ended the session at 160.675. A continuation higher could lead to a test of resistance at the May 4th high (163.50). Aggressive buying could lead to a run to 164.825. A pullback below the 159.975 support level could lead to a test of support at 158.10.
Lean Hogs
The December Lean Hogs contract consolidated the Tuesday gains on Wednesday. The 67.80 resistance level and the declining 100 DMA (68.40) held Hogs in check as the high for the day came in at 68.00. This is below Tuesday’s 68.175 high. It pulled back to the 66.55 support level, with the low at 66.30. It ended the session at 66.525, right at support. This is above The Tuesday low at 65.425. It formed an inside candle right at key support and resistance levels. A break out above the high could take price up and test resistance at 69.90. A failure from the low could lead price down to test support at the gap from the Tuesday low to the Monday high at 65.30. Support then comes in at 64.80.
For those interested I hold a weekly grain (with Sean Lusk) and livestock webinar on Thursday, November 2 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.