August 18, 2019
Last week at this time we knew the board was going to break lower, how hard and how long it would last were the big question marks. We were fairly up-beat near mid-week, but our tune changed as we got through Thursday afternoon and Friday morning. It felt easy to buy the break when the dust settled and we started trading off locked limit, but the lack of buying enthusiasm after a quick deep discount is a caution flag for the near term. If it was that easy, the market would have already moved. The fact that it didn't indicates that there may be bigger problems and questions behind the scenes (This is not just for cattle but can also be said for corn and hogs). We think there will be a great opportunity in live cattle going out to February and April but would not be surprised to see things get worse before they get better. Cash trade came in from 105-106 last week, early calls for this week is another 1-2 lower.
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.
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