December Live Cattle recovered from Thursday’s loss on Friday, October 26, 2018. It formed a bullish outside candle as it traded back into the upper part of its 116.025 to 119.75 trading range. It made its high for the day at 118.80 and settled nearby at 118.40. Futures started the day on a weak note, opening below Thursday’s settlement and dipping below the Thursday low (116.80) to 116.60. This just above the 116.55 support level that has so far held repeated attacks. With futures languishing early in the trading session, reports of cash trading at 113.00 and then 114.00 sparked a rally up to the high. It is somewhat disappointing that futures couldn’t rally past the 119.15 resistance level and challenge the 119.75 high. It would have been nice to see futures end the week with a new high for the up move. The inability to make a new high keeps the December contract within the trading range and futures have some work to do next week. Resistance remains at 119.15 and the 119.75. A rally above 119.75 puts 120.75 and 121.90 in play. A failure from the Friday high could see price fall back to the lower support levels at 117.725 and 116.55. Packers continued to be aggressive, acquiring cattle up at 115.00 and paying 180.00 on a dressed basis. Boxed beef continued its climb, up 0.37 to 213.47 for choice and select up 0.52 to 198.83. The choice/ select spread narrowed to 14.64 on 73 loads.
For those interested I hold a weekly grain (with Sean Lusk) and livestock webinar on Thursday, November 1st 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.