Live Cattle (December)
December live cattle futures continued their rally yesterday, posting the fifth consecutive day of gains which is the longest streak since July. The rally has brought the RSI to 65, generally anything above 70 is considered overbought. The rally has prices right back to the scene of the crime from the August 2nd breakdown point. If the Bulls can close above 184.225 we could see a technical tailwind take prices up near 188. If the market does take a pause here, a pullback to 181.325-182.07 would be a spot to keep an eye on.
- Resistance: 184.225-184.50, 187.675-188.00
- Pivot: 181.325-182.07
- Support: 179.10-179.97, 175.72-176.10, 173.17-173.87**
Commitment of Traders Update
Friday’s Commitment of Traders report showed another week of flatlining for Fund positioning, important to note that the data is through Tuesday, so it does not include positioning with the rally we saw at the end of the week. Funds are net long roughly 44k futures/options contracts. We view this as a historically neutral position.
Feeder Cattle (October)
October feeder cattle had an inside day yesterday, trading within the previous day’s range. With the market little changed at the close, technical support and resistance levels remain intact. Grain markets continue to see strength this morning on the back of Chinese stimulus, if that strength continues it could impose a headwind for feeders in the short term.
- Resistance: 245.90, 249.85-250.80*
- Pivot: 242.75-243.45
- Support: 239.62-240.15, 236.20-236.75*
Commitment of Traders Update
Friday’s Commitment of Traders report showed funds were net buyers of roughly 1.7k futures/options contracts, trimming their net short position to just 870 contracts.
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