April live cattle futures chopped around near our resistance pocket yesterday, keeping things in limbo for today's trade. If the Bulls can achieve a close above 188.05 we could see an extension into the October 23rd gap from 189.10-190.275. If we fail to breakout, some profit taking ahead of Friday's Cattle on Feed wouldn't be out of the question. Fundamentals are still pretty stout, but we continue to believe this is a spot to manage risk if you're long the cattle in the pasture. Volatility is relatively low, near the lower end of the years range. That indicates that there isn't a lot of uncertainty right now, which makes options relatively affordable as a way to take a position or manage risk in the cattle markets.
Resistance: 187.30-188.05***, 189.10-190.275***
Pivot: 184.65-185.00
Support: 182.60-183.45**, 180.50-181.45***
Seasonal Tendencies
Below is a look at historical seasonality's (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) Funds were net buyers for the fourth consecutive week, extending their net long position to 42,472 futures and options contracts. This is still well below what we saw in the Fall, but this would historically be a pretty neutral position.
Feeder Cattle
Technicals (March - H) Feeder cattle continue to outperform to the upside yesterday, more so on the deferred contracts. For March, the target for many traders remains intact near 253.10, which was the breakdown point from October 19th. The RSI is at 72.99, which is technically overbought. Keep in mind though that we did see the RSI as high as 81.40 when the market peaked back in September.
Resistance: 253.10**, 258.00-258.675**
Pivot: 248.25-249.025
Support: 242.12-242.35***, 237.57-238.92***
Seasonal Tendencies
Below is a look at historical seasonality's (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) Funds expanded their net long position in feeder cattle to 7,346 futures and options contracts.
Lean Hogs
Technicals (April- J)
April lean hog futures came out of the gates strong yesterday but fizzled out to settle about 1.50 off the high and closer to unchanged. We continue to believe this market has probably gotten a little ahead of its skis for the time being. A break and close below 84.52 could confirm that and trigger a round of profit taking.
Resistance: 85.50-86.05****, 87.50**
Pivot: 83.60-84.00
Support: 82.67-82.80***, 79.425-80.00***, 77.25**
Seasonal Tendencies
Below is a look at historical seasonality's (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 expanded their net long position to 31,647 futures/options contracts, back near levels from the Fall.
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