Cattle futures were relatively quiet in yesterday’s, but will a risk-on trade in the outside markets add a tailwind to prices ahead of the Cattle on Feed report?Â
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Live Cattle
Technicals (June-M)
Not a lot of new news here for cattle as prices were little changed in yesterday’s trade. With that said, after the close the outside markets did see a risk-on trade which sent many commodity markets higher into the afternoon trade which has spilled over into a similar environment in the early morning hours. This could be a tailwind for live cattle in today’s trade. Tomorrow’s Cattle on Feed report will also be top of mind which could play a role in price action as traders look to position in advance. The average analyst estimate for On-Feed comes in at 100.9%. Placements are estimated to be near 106.4%. And markeings near 104.1%.
Yesterday’s cutout values were mixed with choice cuts 22 cents higher to 313.44 and select cuts down 47 cents to 302.71. Daily slaughter was reported at 116k head, about 11k less than the same day last year.
Resistance: 185.85-186.625*, 189.05
Pivot: 182.20
Support: 179.825-180.625**, 177.10
Seasonal Tendencies (June Live Cattle)
Below is a look at historical seasonality’s (updated each Monday) VS today’s prices (black line). Seasonally we start to see June futures soften up, but if you’ve been watching cattle at all over the last year you know that seasonals tendencies tend to have had a lower correlation this year.
*Past performance is not necessarily indicative of futures results.
Commitment of Traders Snapshot
(updated on Mondays)
Friday’s Commitment of Traders report showed Funds were net buyers of about 4k futures and options contracts, extending their net long position for the eighth consecutive week, now sitting roughly 63.3k contracts long. Typically, we would view this as a relatively Neutral/Bullish position. This is about half of the length they had when prices peaked last Fall.
Feeder Cattle
Technicals (April- J)
April feeder cattle futures were little changed in yesterday’s trade as prices continue to linger near a short-term trendline resistance channel and the 20-day moving average. If the market can chew through and close above that barrier, it could trigger additional technical buying. We continue to lean into the bearish side at these levels with a retest of the first support as a first target.
Resistance: 256.90** 260.65-260.80***
Support: 252.60 253.85, 248.00-249.00*
Seasonal Tendencies
Below is a look at historical seasonality’s (updated each Monday) VS today’s prices (black line). Historically, this isn’t the best time to get supper bulled up on Feeder Cattle, but time will tell.
*Past performance is not necessarily indicative of futures results.
Commitment of Traders Snapshot
(updated on Mondays)
Funds were net sellers of about 1.5k contracts last week, the bulk of which was long liquidation. That shrunk their net long position to 10.3k contracts, which is on the larger side of historical holdings.
Lean Hogs
Technicals (April- J)
Lean hogs were lower in yesterday’s trade and although it may have looked ugly by the price alone, not much was changed on the technical landscape. Trendline support is creeping higher, now coming in near 85.00. A break and close below that pocket could spur a retest of the 50-day moving average which comes in closer to 83.35.
Resistance: 89.00-89.05**
Pivot: 85.50-86.05
Support: 82.80-83.35****
Seasonal Tendencies
Below is a look at historical seasonality’s for June lean hogs (updated each Monday) VS today’s prices (black line).
*Past performance is not necessarily indicative of futures results.
Commitment of Traders Snapshot
(updated on Mondays)
Friday’s Commitment of Traders report showed funds little changed from the previous week, holding a net long position of 63.7k contracts.
