Live Cattle
Technicals (August-Q)
August live cattle had a rough go of it in the back half of last week’s trade, but still managed to post an impressive month. A flurry of bearish headlines sparked the liquidation into the end of month, which we feel was a little bit overdone and could be setting up for a buying opportunity. A break and close back below 176.35 would start to neutralize that bias. Friday’s Commitment of Traders report showed funds were net buyers of about 8k contracts, expanding their net long position to 58,556. Keep in mind that that data is only compiled through Tuesday, so it doesn’t include the selloff from the back half of the week.
- Resistance: 181.85-182.15, 183.175-183.40*
- Pivot: 179.82-180.15
- Support: 177.75-178.40*, 176.35
Lean Hogs
Technicals (July – N)
July lean hogs tried to carve out a low at the end of last week’s trade, whether or not that can carry over into a new week and a new month of trade is still TBD. We’ve been in the camp that we can see stabilization based on oversold conditions, stabilizing fundamentals, and a reduced risk of long liquidation. Our Bearish bias at the end of April and through the first part of May was on the back of Funds holding their largest net long position since 2013. Their net long position has dropped from about 92k contracts to under 30k net long contracts, the smallest net long position since January. Important to note that unlike cattle futures, it’s not uncommon for funds to go net short.
- Resistance: 99.475-100.575****, 103.10***
- Pivot: 97.78-98.67
- Support: 95.225-95.75****, 91.85-92.52***
Feeder Cattle
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