Live Cattle (April)
The bullish tailwind we got from Friday’s Cattle on Feed report was quickly dismissed as a flurry of bearish headlines created a global risk off trade that weighed heavy on the outside markets. April live cattle dropped like a rock on yesterday’s open, spending majority of the session and closing at limit down, giving us expanded limits for today’s trade (4.50). Cash cattle in Iowa started at 116 yesterday, 3-4 lower from last week. We think that this dramatic discount will provide a buying opportunity but remain patient and look at using smaller position sizes with clients. This type of trading environment creates an emotional trade, which is also often an irrational trade. Yesterday’s Cold Storage report had beef stocks at 489.136 million pounds, below expectations.
Bottom Line: Our intermediate term bias has been on the bearish side for the last several weeks. The chart looks ugly, but we think....Click this link to get our FULL report! Or email [email protected]
Feeder Cattle (March)
Feeder cattle will be trading with expanded limits today after failing to buck the trend of a global risk-off bloodbath in yesterday’s session. Though we think this could set up for a buying opportunity in the not to distant future, we are resisting the FOMO (Fear Of Missing Out) near term. As mentioned with live cattle, this type of trading environment creates an emotional trade, which is also often an irrational trade.
Lean Hogs (April)
April lean hogs fell victim to the spillover effect from the outside market turmoil but managed to hold their own better than we had anticipated. If outside markets can find their footing and stabilize at the least, we think there is opportunity in the near term. With that said, fears of the coronavirus will persist, and weekends will continue to hold more headline risk, so managing your risk and position sizes is key (as usual). Yesterday’s cold storage report showed pork stocks at 625.188 million pounds, below expectations.
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.