Livestock Roundup (5.7.18)
May 07, 2018
LEM8: -.725 at 105.325, trading in a range of 1.425
LEQ8: -.825 at 104.25, trading in a range of 1.35
GFK8: -2.70 at 137.70, trading in a range of 2.75
GFQ8: -2.70 at 143.625, trading in a range of 2.95
Cattle Commentary: Live cattle futures posted their high and low for the day within the first hour of trade and finished closer to the low end of the day’s range. We are optimistic due to the wide basis, but the chart is starting to look tired (see technicals below). Last weeks cash trade volume of 169,490 head was the largest since the fall of 2013. The cash trade was mostly steady to firm last week. Early calls for this week’s cash cattle trade is expected to be moderately softer. This week is the Goldman roll for June contracts, we would not be surprised to see some of the deferreds out-gain the front months. Some funds have skipped rolling all together and have been in liquidation mode. Friday’s Commitment of Traders report showed that manage money was net sellers of 3,956 futures, this puts their net long position at a measly 11,431 futures contracts. On the feeder cattle side of things, managed money was net buyers of 234 futures, this shrinks their net short position to 3,766 contracts.
PM Boxed Beef / Choice / Select
Current Cutout Values: / 229.14 / 211.20
Change from prior day: / .84 / 1.71
Choice/Select spread: / 17.94
Live Cattle (June)
June live cattle futures are starting to look tired on the chart as we continue to hover around the 106 area. First technical resistance this week comes in from 107.10-107.825, this pocket represents the top end of last weeks range and the 50-day moving average (which is falling fairly quickly). If the bulls can chew through resistance, we could see a run towards 109, but the bulls will have their work cut out for them at that point. If the bulls cannot get any momentum going above resistance this week, we could see the selling start to accelerate again. On the support side of things....Please sign up for a Free Trial at Blue Line Futures to view our entire technical outlook and proprietary bias and levels.
Feeder Cattle (August)
August feeder cattle were under a lot of pressure today as they tested the bottom end of last weeks range. First support managed to hold from 143.00-143.25, this pocket represents the 200-day moving average along with a key Fibonacci retracement level for the year. This pocket would also defend higher lows which has been a trend over the last month. If the bulls cannot defend this level, we could see pressure pick up and press prices back towards....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 hog futures continue to chop around in what appears to be uncertainty. June futures finished the day up .55 at 74.075, this after trading in a range of 1.80 for the day. Friday’s Commitment of Traders report showed that managed money sold 7,765 futures, this puts their net short position at 5,101 futures. We are fairly neutral the market at this price point as the futures float in the middle of our risk range. On the top end, the significant resistance comes in at....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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