Estimates for Friday’s Cattle on Feed report
On Feed: 94.8%
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Live Cattle (June)
June live cattle tested our first level of resistance at 85.34 (high was 85.25), but ultimately failed which led to technical selling into the close. April live cattle finishing limit down didn’t help the cause either April is the delivery contract, so we are not in expanded limits. First technical support comes in from 79.85-80.70. The bulls MUST defend this pocket, a break and close below leaves the door open for a retest of the contract lows, 76.60. On the resistance side of things, 85.35 is the first barrier. If prices can chew through this area, we could see an extension towards 88.125-89.25.
Bottom Line: There have been intraday opportunities for both sides, we expect this to continue. If you want to be long for the long term, consider an options strategy or deferred contracts for a core position.
Resistance: 85.35**, 88.125-89.25****
Support: 79.85-80.70****, 76.60***
Feeder Cattle (August)
August feeder cattle traded in a relatively tight range, keeping the technical landscape unchanged from yesterday’s report. Technical resistance today comes in from 130.30-131.225. These are wider ranges than we typically like to rely on, but that’s the environment we are in. If the bulls can achieve consecutive closes above this pocket, we believe that would open the door for a retest of the March 25th highs, 139.00. On the support side of things, 121.00-121.65 is a significant pocket. A close below here could take us to the gap from April 6th, 118.825.
Resistance: 130.30-131.225***, 134.10-135.10**, 137.70-139.125****
Support: 123.475**, 121.00-121.65****, 118.825**
Lean Hogs (June)
June lean hog futures tried to work higher yesterday bt finished the day near unchanged as buyers seem skeptical of the recent rally. The coming day’s will likely set the stage for what’s to come. We did close the gap from April 9th, yesterday, that is a start. The bulls need to see consecutive closes above here, 49.175. If they can achieve that, then we could see an extension towards The April 8th highs. A failure here spells disaster and likely takes us back to the lows.
Feel free to call/text/email, Oliver with any questions.
Oliver@BlueLineFutures.com and 312-837-3938
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.