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What's next for cattle?

Published on: 22:55PM Nov 16, 2017

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Cattle Commentary:  Cattle futures a two quite trade throughout the session, finishing the day marginally lower in live cattle and feeder cattle.  December live cattle finished the day -.60 at 119.60 with January Feeders closing at 153.75 which was down .50 on the day.  Beef export sales this morning came in at 9,300 mt, this was down 45% from the previous week and down 42% from the four week average.  Cash trade was basically nonexistent today after we saw some active participation yesterday in between 119 and 120.50.  It appears that many market participants are sitting on their hands as we approach tomorrows Cattle on Feed report which is due out after the close.  Early estimates are for:  On Feed: 106%, Placed: 108.5%, and Marketed: 105.2%.

PM Boxed Beef                 Choice                 Select 
Current Cutout Values:  210.24                  187.89
Change from prior day:  .11                         -2.78
Choice/Select spread:    19.52

 

Cattle Technicals

Live Cattle (December)

December live cattle posted their second consecutive inside day which is when prices stay contained within the previous day’s range.  After the recent spike in volatility, it makes sense that we see this consolidation.  Also lending a hand to consolidation is the fact that we have a Cattle on Feed report out tomorrow and some market participants may have moved to the sideline or are sitting on their hands ahead of that.  The market has come into consolidation between very important support and resistance levels which will likely lead to an interesting Monday trade despite it being a holiday week.  First technical support comes in from 117.70-118.25 and on the resistance side we are keeping an eye on 121.625-122.00; a close above or below this level will likely help set the tone for the remainder of the year. 

Resistance: 121.625-122.00**, 123.825-123.90**, 125.90-126*

Support: 117.70-118.25***, 114.81-115.37****

 

Feeder Cattle (January)

January feeder cattle moved lower to test the 50-day moving average again but have held.  Price action was encouraging at support but don’t confuse that with bullish.  The 50-day moving average has held as support since September, a breakdown and close below opens the door to continued pressure and long liquidation back towards 148.  We will get an updated commitment of trader’s report Friday afternoon to get a better idea on where the funds stand.  On the resistance side of things, 155.10-155.55 is the key pocket the bulls want to get back out above on a closing basis, this represents the middle of the range from the recent move from 148-162.  A close above warrants further buying interest. 

Resistance: 155.10-155.55**, 158.70-159.27***, 160.725- 160.90**

Support: 152.475-152.75****, 148.16***

 

Lean Hog Commentary and Technicals (December)

December lean hogs could not take advantage of yesterday’s capitulation like move which is not a good sign for market.  December futures traded up to 60.55, just shy of our resistance pocket from 61.60-62.00.  the failure to get back out above resistance invited sellers back into the market which pressed the market right back near yesterday’s lows.  Though the market has sold off significantly over the course of two weeks, the RSI is only reading 40 which means more pressure is not out of the question.  First technical support comes in from 59.25-59.90.  Higher weights and soft demand have been dubbed the culprit for the move lower. 

Resistance: 61.60-62.00**, 64.20-64.32**, 65.20-65.675***, 68.175**

Support: 59.25-6=59.90**, 57.36*, 55.775-56.20****

 

If you have any questions with regards to markets, trading, or opening an account please let me know!

email Oliver@BlueLineFutures.com

You can also reach us at 312-278-0500

 

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Futures trading involves substantial risk of loss and may not be suitable for all investors. Trading advice is based on information taken from trade and statistical services and other sources Blue Line Futures, LLC believes are reliable. We do not guarantee that such information is accurate or complete and it should not be relied upon as such. Trading advice reflects our good faith judgment at a specific time and is subject to change without notice. There is no guarantee that the advice we give will result in profitable trades. All trading decisions will be made by the account holder. Past performance is not necessarily indicative of future results.If you have any questions with regards to markets, trading, or opening an account please let me know!

email Oliver@BlueLineFutures.com

You can also reach us at 312-278-0500

 

Follow us on Twitter:@BlueLineFutures

Follow us on Facebook:Blue Line Futures Facebook page

Subscribe to our YouTube channel:Blue Line Futures YouTube channel

 

 

Futures trading involves substantial risk of loss and may not be suitable for all investors. Trading advice is based on information taken from trade and statistical services and other sources Blue Line Futures, LLC believes are reliable. We do not guarantee that such information is accurate or complete and it should not be relied upon as such. Trading advice reflects our good faith judgment at a specific time and is subject to change without notice. There is no guarantee that the advice we give will result in profitable trades. All trading decisions will be made by the account holder. Past performance is not necessarily indicative of future results.