Live Cattle
The June Live Cattle contract made another new low for the down move, trading to a low of 106.65 on Wednesday, March 21, 2018. It made an early test of the trendline (109.25) as it opened at 109.00 and up ticked to 109.125 before breaking down and trading through the 108.65 support level. It consolidated near 108.65 and then started to breakdown, trading to 107.70 and then trading to the low late in the session. It recovered at the end of the session getting up to 107.60. It ended the day nearby at 107.45. Support remains at 106.025, then 104.85. Resistance is at 108.65, the rising trendline (109.40) and then 110.80. The negotiated cash trade in Nebraska was light to moderate on moderate demand with live sales from 126.00 – 126.50 and dressed sales at 203.00. In Colorado, trade was light on light to moderate demand with live sales at 126.50. In the Western Cornbelt trade was light to moderate on moderate demand with dressed sales at 203.00. Trade was limited in all other major feeding regions. Wednesday afternoon boxed beef cutout values were higher on Choice and weak on Select on light to moderate demand and offerings. Choice was up 1.03 to 224.38 and Select was down 0.35 at 216.39 on 123 loads. The choice/ select spread widened to 7.99. The estimated cattle slaughter for Wednesday was reported at 118,000.
Feeder Cattle
The April Feeder Cattle contract opened at 137.825, traded to the high at 138.175, drifted, then broke down and traded through the 136.75 support level making the low at 135.725. It ended the day nearby at 136.35. A break down below the Wednesday low could lead to a test of support at 134.25. Support then comes in at 133.30. Trading above the 136.75 level could lead to a test of resistance at 138.95.
Lean Hogs
The June Lean Hogs contract opened at 76.70 and retested support at 76.225. It equaled Tuesday’s low at 76.15, consolidated and then a late day rally took price towards resistance at 77.80. It reached the session high at 77.625 and ended the session nearby at 77.375. A break out above 77.80 could lead to a test of resistance at 78.425 and then 79.775. A failure from the high could see price test the Tuesday high (77.10) and then support at 76.225 and then 75.625.
For those interested I hold a weekly grain (with Sean Lusk) and livestock webinar on Thursday, March 22nd 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.* *
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.