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Livestock Report


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Live Cattle

On Thursday June 14, 2018 the August Live Cattle contract opened at 103.50, traded to the high at 103.825 and then fought its way lower, grinding down to the session low at 101.325 and settling nearby at 101.875. The settlement is just above the 101.625 support level. This will be the key for trade on Friday, in my opinion. A rally above settlement could test resistance at 103.00 and then 104.20. Breaking below the 101.625 support level could see a break down to the 100.125 support level. Support then comes in at 99.375. Negotiated cash trade on Thursday was limited on light demand in most major feeding regions. Thursday afternoon boxed beef cutout values were weak to lower on light to moderate demand and moderate to heavy offerings. Choice was down 1.82 at 222.08 with Select down 0.33 to close at 201.97 on 125 loads. The choice/ select spread narrowed to 20.11. The hide and offal value from typical fed cattle for today was estimated at 9.46 per cwt live, up 0.05 from Wednesday's value. The estimated cattle slaughter for Thursday was reported at 116,000, last week 121,000 and a year ago 119,000.

Feeder Cattle

The August Feeder Cattle contract opened at 145.35, traded to its high at 145.70 then pounded the 144.20 support level until it gave way and price fell, trading to the session low at 143.25. This is just below support at 143.50. It settled just above support at 143.675. Trading above settlement could test resistance 144.20, 145.05 and aggressive short covering could see 146.20 revisited. Trading below 143.50 could see futures pounded down to 142.425 and then 140.775.

Lean Hogs

The July Lean Hogs contract opened at 82.80 traded to the session high at 83.175 and broke down, taking out the Thursday low (81.75) and trading to 81.25. It settled at 81.625.A recovery from settlement could see resistance at 82.65 tested and then the Wednesday high at 83.225. A failure from settlement could see support at 80.30 revisited. Support then comes in at 79.775 and then 78.425.

For those interested I hold a weekly grain (with Sean Lusk) and livestock webinar on Friday, June 154th at 3:00 pm. It is free for anyone who wants to sign up and the link for sign up is below. If you cannot attend live a recording will be sent to your email upon completion of the webinar.

Sign Up Now

**Call me for a free consultation for a marketing plan regarding your livestock needs.* *

Ben DiCostanzo

Senior Market Strategist

Walsh Trading, Inc.

Direct: 312.957.4163

888.391.7894

Fax: 312.256.0109

bdicostanzo@walshtrading.com

www.walshtrading.com

RISK DISCLOSURE: THERE IS A SUBSTANTIAL RISK OF LOSS IN FUTURES AND OPTIONS TRADING. THIS REPORT IS A SOLICITATION FOR ENTERING A DERIVATIVES TRANSACTION AND ALL TRANSACTIONS INCLUDE A SUBSTANTIAL RISK OF LOSS. THE USE OF A STOP-LOSS ORDER MAY NOT NECESSARILY LIMIT YOUR LOSS TO THE INTENDED AMOUNT. WHILE CURRENT EVENTS, MARKET ANNOUNCEMENTS AND SEASONAL FACTORS ARE TYPICALLY BUILT INTO FUTURES PRICES, A MOVEMENT IN THE CASH MARKET WOULD NOT NECESSARILY MOVE IN TANDEM WITH THE RELATED FUTURES AND OPTIONS CONTRACTS.



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About the author


Ben DiCostanzo
Senior Market Strategist
Walsh Trading

I began my career in the Securities industry working as a runner on the floor of the New York Stock Exchange while I attended Pace University. I then started working for Salomon Brothers in their Government Bond Trading arena. After graduating from Pace University with a degree in Accounting, I transferred to Chicago and became a member of the Chicago Mercantile Exchange utilizing my experience to execute trades and manage risk for institutional clients as a broker for Salomon Brothers on the trading floor. I then embarked to trade for my own account in the stock indices pits as a local before moving off the floor to aid and assist individual clients in their trading endeavors. I now work at Walsh Trading holding a series 3 broker’s license whose duties include being the firm’s Chief Market technician.

I understand that every client's needs are different, and I pride myself in tailoring my service to each client's unique circumstances and needs. Individual client experience, risk tolerance, and capital all play a role in how I approach the markets. I am involved in all markets using technical analysis to find opportunities. My approach is driven by the principles of capital preservation.

My trading philosophy is that if you can recognize and manage the risk, you have a better chance to be successful in trading. I advise clients to always use stops as money management in my opinion is the most important ingredient in trading commodities.

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