“Shootin’ The Bull”
End of Day Market Recap
by Christopher Swift
4/11/2024
Live Cattle:
Traders seem a little less inclined to sell futures off too much further from cash. With the basis swapped, there is believed significant business being conducted. With prices now having explored the lower end of the trading range, it leads me to begin to anticipate a move back to the top of the triangle. Recall, a contracting price pattern is what is expected. So far, it has held that way. I'm in no hurry to do anything yet. There isn't much to go by at the moment in the cash markets and we are still discovering what the consumer will and won't pay for.
Feeder Cattle:
Most contract months slipped to a new low in this decline. Today's sharp rally from may well reflect the bottom for the time being. The index continues to soften and if anything does materialize, it will most likely just be a divergence of basis at the moment. Were this to materialize, then it would potentially produce another opportunity for producers to market inventory at prices that may or may not be available when physical marketing takes place. Cattle feeders are the ones with the advantage of the moment. They can buy April and May feeders for dollars under the index, or could actually hedge with a basis only a few dollars against them, instead of the $20.00 plus that has plagued cattle feeders for the past three months. So, the break in price is believed to have helped more than hindered. If you were one of the ones hindered by this price break, consider learning more about how futures and options may or may not be of benefit to your operation.
Hogs:
Hogs were a little higher. The index was up sharply from the last index reading to this morning's. It is $87.05.
Corn:
The markets appear no better or worse after the report than before. With little price action discovered on this news, it suggests traders will want to see how planting progress goes. New crop corn and beans continue to slip though and already having the previously recommended options spread initiated will provide a great deal of leeway in your marketing.
Energy:
Energy is trading lower. This is believed a correction of the abrupt move higher with expectations of the up trend resuming.
Bonds:
Bonds made another new low in this decline from the PPI data. The combination of the two were stronger than anticipated and is keeping bonds from making the headway higher I had anticipated. I still believe this is a major wave 2, but may still have some unfolding to do. Especially since the Fed can't seem to stop those pesky consumers from spending.
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