Cattle futures got hit hard to start the week but were able to gain some ground back yesterday. Was it a dead cat bounce or is the low in?
Live Cattle
Technicals (June-M)
June live cattle were able to recover in yesterday’s trade, but it really wasn’t until the last half hour of trade. Much of the mid-morning trade was the market fluttering around near unchanged, which is not what the Bulls wanted to see after such a sharp drop lower in the previous session that was largely headline driven, which to us indicates that there could be a lingering concern surrounding future headlines. Resistance remains intact from 177.72-178.45. If the Bulls can chew through and close above this pocket it could help calm the nerves. Until then, the Bear’s have the technical and seasonal advantage.
Resistance: 177.72-178.45,181.725-182.40*
Pivot: 175.70-176.40
Support: 172.90-173.425, 169.00-170.00
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 sellers of roughly 3.2k contracts, not a lot, but most of it was from long liquidation. This drops their net long position to 59,164.
Feeder Cattle
Technicals (April- J)
April feeder cattle were able to crawl back to our pivot pocket from 243.50-244.00. If the market is able to achieve consecutive closes above this pocket, we could see additional relief take pries back to the breakdown point near 250, which happens to also coincide with the 20 and 50 day moving averages. If the market were to get back to this level, we would be taking a look at the short side.
Resistance: 247.15-248.00, 250.00-251.00*
Pivot: 243.50-244.00
Support: 238.90-240.275****
Seasonal Tendencies
Below is a look at historical seasonality’s for May Feeder Cattle (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 hold a net long position of 8,193 futures/options contracts.
Lean Hogs
Technicals (June-M)
June lean hogs made new highs for the move in yesterday’s trade but it seemed to lack the conviction the Bulls may have been looking for just based on the previous day’s trade alone. Resistance remains intact from 104.50-105.00. Despite the strong technical landscape, the historical seasonal trends continue to keep our optimism at bay.
Resistance: 104.50-105.00*
Pivot: 103.00-103.50
Support: 101.15, 98.60-99.20, 97.42-97.80***
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 64,951 contracts. Looking back at historical holdings, this is on the larger side of things.
