Livestock Roundup (4.18.18)
Apr 18, 2018
LEM8: .45 at 105.35, trading in a range of 1.025
LEQ8: .675 at 105.125, trading in a range of .65
GFK8: .525 at 140.775, trading in a range of 1.40
GFQ8: 1.125 at 146.20, trading in a range of 1.225
Cattle Commentary: Cattle futures opened higher, printing their daily high in in the first hour for the third consecutive time (almost at the exact time). We still think that there is room to work higher in the back half of the week (see technicals below) but may need some help from cash. Today’s Fed Cattle Exchange sold 499 of the 3,220-head offered. 338 sold at 120 and 161 at 122. Market participants will be anxiously awaiting more cash trade as we enter the back half of the week; early calls have been for steady to firm. On top of that, we also have a Cattle on Feed report Friday afternoon which may add some volatility to the market due to last minute position squaring. Early estimates for Friday’s cattle on feed report are: Cattle on Feed to come in at 107.5%, Placements at 90.6%, and Marketing’s at 96.1%. Boxed beef was lower on the day.
PM Boxed Beef / Choice / Select
Current Cutout Values: / 211.64 / 198.57
Change from prior day: / (.49) / (1.01)
Choice/Select spread: / 13.07
Live Cattle (June)
June live cattle posted their high for the day before 9:30am cst for the third consecutive session. The high print continues to bump up right against our resistance pocket which we have defined as 106.05-106.925. We believe another test of this pocket could be enough to encourage the breakout. We often compare price and technical to a wrecking ball and a building; the more times a level is tested the weaker it becomes. If the bulls can achieve a conviction close above resistance, we could see an extension towards....Please sign up for a Free Trial at Blue Line Futures to view our entire technical outlook and proprietary bias and levels.
Feeder Cattle (May)
May feeder cattle are being pretty stubborn as they consolidate along support which comes in from 139.425-139.95. We still think the market can squeeze towards 143.35-144.50 but it’s going to be tough to get much more juice out of the grape from there. This pocket represents includes the 50% retracement from the November highs to the April lows. This pocket also contains the 50, 100, and 200 day moving average. On the support side of things, a breakdown and close below 139.425 opens the door to....Please sign up for a Free Trial at Blue Line Futures to view our entire technical outlook and proprietary bias and levels.
Lean Hog Commentary and Technicals (June)
Lean hogs staged an impressive session with the June contracts last trade coming in at 78.50, up 1.75 on the day, after trading in a range of 2.175. Resistance from 78.05-78.45 gave way and this would keep the mojo in the bulls favor as we see a stair step of higher lows and higher highs continue since the April 4th bottom of 70.25. Today’s close was slightly off the highs but could encourage an extension towards....Please sign up for a Free Trial at Blue Line Futures to view our entire technical outlook and proprietary bias and levels.
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