Live Cattle
Technicals (October – V)
Live cattle futures came out of the gate with some strength yesterday, trading within 15 cents of our resistance pocket from 182.675-183.275, before retreating and reversing back lower to trade within our support pocket from 179.35-180.50 (settling at 180.75). If that support pocket gives way, we could see the selling momentum pick back up in a more meaningful way with the next downside target coming in from 176.35-177.22. Our bias of “sell rallies” remains intact, particularly for those who need downside protection. A break and close above our 4-star resistance pocket would neutralize that bias.
- Resistance: 182.675-183.275*
- Pivot: 181.175-181.50
- Support: 179.35-180.50**, 176.35-177.22
Daily Cattle Summary
Yesterday afternoon’s cutout values were firm with choice cuts up 2.06 to 316.94 and select cuts 1.53 higher to 302.03. Daily slaughter was reported at 120k head. The 5-area average price for live steers was at 187.63, on light volume.
Weekly Export Sales: Thursday’s weekly export sales report showed net sales beef were reported at 28,100 MT for 2024–a marketing-year high–were up noticeably from the previous week and up 99 percent from the prior 4-week average.
Below: Daily chart of October live cattle which illustrates the recent recovery back near the middle of the recent range.
Seasonal Tendencies
Below is a look at prices averages for October live cattle over the last 5, 10, 15, 20, and 30 years. As referenced many times last month, August can be a tricky year to stage a meaningful rally. Those headwinds start to subside some when we turn the calendar over to September. *Past performance is not necessarily indicative of future results.
Feeder Cattle
CME Feeder Cattle Index: 246.34 +1.02
Technicals (September- U)
Like live cattle, feeder cattle attempted to rally yesterday before reversing to finish the day lower. Wide ranging trades are to be expected as the dust continues to settle following the sharp selloff that started two weeks ago. We continue to be in the “sell rallies” camp, but there is still some upside recovery risk from these levels, so position sizing remains paramount.
- Resistance: 245.32-245.875*, 248.675-249.20
- Pivot: 242.15-242.22
- Support: 238.97-239.15, 236.57-236.75, 233.05-233.95*
Below: Daily chart of September feeder cattle that illustrates the accelerated selling pressure that took place following a break below trendline support. Also included is a set of Fibonacci retracements from this year’s trading range.
Seasonal Tendencies
Below is a look at prices averages for November feeder cattle over the last 5, 10, 15, 20, and 30 years. We are using November so you can see the longer trend as opposed to the front months which are on a much shorter time frame. As referenced many times last month, August can be a tricky year to stage a meaningful rally. Those headwinds start to subside some when we turn the calendar over to September, but that strength has often been short lived. *Past performance is not necessarily indicative of future results
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