LEQ8: -.725 at 102.90, trading in a range of 1.875
LEV8: -.30 at 105.975, trading in a range of 1.50
GFQ8: -1.10 at 145.225, trading in a range of 2.025
GFU8: -.60 at 146.00, trading in a range of 1.60
Cattle Commentary: It was a risk off day in a lot of commodities, livestock was not immune. Continued concerns revolving around the idea of a potential “trade war” has led to a buyers strike. The market floated around in a relatively quiet fashion until the final minutes of trade where we saw electronic orders get hit/pulled as the market plummeted to the lows of the session. The bulk of cash trade last week came in between 109-111; that will be the bar for this week’s trade. Basis has narrowed up sharply over the last month thanks to the sharp drop in cash, this has relieved the pressure for the board to rally hard. We are expecting to see cash activity pick up this week so are friendly the fats on the first test of technical support (see technicals below). This weeks Fed Cattle Exchange has 568 head offered.
PM Boxed Beef / Choice / Select
Current Cutout Values: / 227.57 / 206.25
Change from prior day: / .04 / 1.45
Choice/Select spread: / 21.32
Live Cattle (August)
August live cattle broke at the end of the day, printing a low of 104.225. This low coincides with a trendline from the May 18th lows along with a key retracement that is derived from the November highs to the April lows. We feel that this pocket provides great risk/reward value on the first test. If the market closes below the 102 handle, we will likely look to lick the wounds and move onward. On the resistance side of things, the bulls want to find traction above the 50-day moving average which comes in at 103.20. Consecutive closes above here helps build a nice foundation for a run towards the top end of the range which we have coming in from 105.20-105.95. Though the market is changing daily, we believe the market would struggle to stage a breakout (as things stand now).
Resistance: 103.20**, 105.20-105.95***
Support: 101.90-102.40****, 97.625-98.20****
Feeder Cattle (August)
August feeder cattle finished the session towards the low end of the days range, this after failing to breakout above the 100-day moving average which came in at 146.70 today. The market pulled back off of the rejection and gave way to the 200-day moving average and 50% retracement which come in at 146.00 and 145.50 respectively. If the bulls cannot reclaim ground above these levels, we could see the pressure continue 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 (July)
July lean hogs saw a choppy and volatile session, finishing the day down 1.025, trading in a range of 2.725. Much of the pressure was on the back of lingering concerns of the possibility of a trade war. If those fears are relieved, we could see the market march back towards the top end of the range. First resistance for tomorrows session comes in from 78.80-79.125, but the more significant pocket is 80.15-80.40. On the support side of things, the bulls need to defend 77.20-77.40 on a closing basis. This pocket represents the 50-day moving average and a key retracement on the year. A break and close back below that pocket....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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