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Livestock Levels


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Live Cattle

April Live Cattle stalled on Monday, March 20, 2017, failing to make a new high and trading down to test trendline support at 118.20, making the days low just above it at 118.45. Breaking down below trendline support could close the gap from the March 15 high (118.075) and the March 16 low (118.20). Support is at 117.825 and then the 13 DMA (117.00). A rally that takes price above the Friday, March 17 high (119.75) could lead to a test of resistance at the January 19th high (121.45). This could be a key battleground for the rally. A close above the January 20 high puts the May 2016 high (124.675) in focus. A failure from the January 19th high could signal a significant top and indicate a possible double top formation. More on this possibility as it evolves.

Feeder Cattle

April Feeder Cattle tested support at the 200 DMA (130.60), making its low for the day at 130.80 and then once again took off, surpassing the January 20 high (131.75) and then passing the 50 WMA (132.65) and resistance at 133.00. The rally stalled just above it at the days high (133.70). Price broke down from here and ended the session at 132.75, in between the 50 WMA and the 133.00 resistance level. Another rally above the 133.70 high could lead to a test of resistance at the March 2013 low (136.80). A breakdown from the Monday low (130.80), could lead to another test of the 200 DMA and then trendline support at 129.10.

Lean Hogs

April Lean Hogs traded down to support at the 50 DMA (68.375) making the days low at 68.30 recovered and rallied to resistance at the 8 DMA (69.375) making the days high at 69.275.It broke down from here and ended the session just above the low at 68.55. A breakdown below the days low could see price test support at 67.90. A breakdown from here could lead to a test of support at 66.625. A rally above the 8 DMA could see a test of resistance at 70.00 and then the March 14 high at 71.275.

For those interested I hold a weekly livestock webinar on Friday, March 24 at 3:00pm. 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

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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