December Live Cattle
The market posted a low today at 111.375 just a few ticks below Thursday extreme of 111.425 before rising to settle on the upper end of the day’s range at 112.825. This marks the third time prices have gone out right on the dominant downward resistance channel. The week ends pretty much unchanged and in the process formed what could be interpreted as a potential hanging-man candle (bearish). Its been confusing to say the least and going forward one must be sure not to lean one way in attempting to forecast price movement. If the market stumbles again and holds below 111.700 I’d expect a follow through to +/- 110.600. Keeping an eye on the weekly candle formation, a violation of this level threatens to trigger the bearish implications made apparent in this weeks structure. The market will thus become extremely vulnerable to another (a-b-c) decent. Having said this, there does exist wave pattern evidence that we are wittiness a series of impulsive price advancements stemming from the lows established in mid-August. I believe the market has potential to move substantially in either direction and would give slightly higher odds to the long side. A fortification of 113.300 looks to challenge intermediate resistance at +/-115 and could extend initially as high as 116. A close above 115 sets stage for further upside action targeting +/- 122. Be prepared to stay especially nimble in next week’s early activity.
My analytical breakdown focuses on a blend of wave pattern recognition, long and short term geometrical extensions and momentum signal interpretation. Please feel free to contact me at Walsh Trading to discuss my technical approach. Employing my expert skill set I’d be pleased to offer a free customized outlook for a product in your specific field.