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Livestock Report


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Live Cattle

The October Live Cattle contract continues to consolidate near the 108.675 resistance level. It formed a spinning top candlestick is trading above the 8 DMA (107.475). It was a quiet day on Tuesday, September 19, 2017. The inability to punch through resistance and breakdown below support over the past few sessions has created a potential time bomb. A breakout above the 108.675 resistance level could lead to a test of the 110.80 resistance level. A break down below the 8 DMA could lead to a test of support at the 106.20 level. Support then comes in at 104.875. The negotiated cash market was quiet. The fedcattleexchange.com auction is on Wednesday with 1,450 head for sale. We could get our first look at feigned packer indifference to buying cattle for the week. Tuesday afternoon boxed beef cutout values were lower on Choice and higher for Select on light to moderate demand and offerings. Choice was down 0.51 to 192.11 and Select up 1.13 to 188.83 on 151 loads. The choice/ select spread dropped to a plus 3.28. The estimated cattle slaughter for Tuesday was reported at 118,000.

Feeder Cattle

The October Feeder Cattle contract made a new high for the up move on Tuesday, grinding higher throughout the day and ending the session near the high. It traded up to 153.00, ending the day at 152.925 which is above the 152.30 resistance level and trendline resistance at 152.50. This strong close could lead to a test of resistance at 153.70 and then 154.25. A rally above these levels could lead to a test of the 156.025 resistance level. A break down below 152.30 could see price test support at the 8 DMA (150.325) and then the 149.975 support level.

Lean Hogs

The October Lean Hogs contract consolidated for the second day after Fridays strong rally. It formed a Doji candle, indicating indecision in the market. A rally above the Friday high (61.20) could lead to a test of resistance at 61.80 and then 62.60. Trading below the session low (59.65) could lead to a test of support at 58.10.

For those interested I hold a weekly livestock webinar on Friday, September 22 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

**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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