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"Where seldom is heard a encouraging word": February Live Cattle


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February Live Cattle

I have taken the liberty of altering the lyrics of the iconic cowboy campfire song Home on the Range in an attempt to capture the current mood of the live cattle market. In early week trading action prices continued their downward path to finish down 1.650 at 123.025 just off day's low of 122.650. We have now hit the .382 retracement from the August lows and are just off the .786 from the fourth wave bottom of 119.050. Also of interest is the fact that momentum divergence is visible in the lower time-frame price charts. All this leads me to favor the market establishing a short term low somewhere in this area. Today's extreme came in on the hourly channel-line and any press should find near term support at +/- 123.300. If a rebound were to develop I'd expect it to be of an non-impulsive nature. Cross zone resistance comes in between 125.700-126. If the price path taken were to lay out in a three wave pattern one should be looking for a rejection off this level. Looking out a few sessions I wouldn't rule out a choppy trade up to the +/- 128 level. My overall target projection in February comes in at +/-119.500. My suggested strategy would be to stalk out any rebound for the previously mentioned structural clues converging with the established retracement targets.

My analytical breakdown focuses on a blend of wave pattern recognition, long and short term geometrical extensions and momentum signal interpretation. Please feel free to contact me at Walsh Trading to discuss this and other proposed strategies.

Please join me next Tuesday as I apply Wave Theory and Geometric targets levels to this and other commodity markets.

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John Lunney

Senior Technical Analyst

Walsh Trading

312 878 2391

888 391 7894 toll free

312 256 0109 fax

jlunney@walshtrading.com

www.walshtrading.com

Walsh Trading

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Chicago, Il 60604

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About the author


John Lunney began his trading career in 1989 as a clerk for IFO, the largest futures and futures options brokerage on the CME floor. Within one year, John was promoted to an executing floor broker responsible for handling large individual and institutional accounts. John’s knowledge of option theory and tactics quickly attracted a growing customer base. In 2000, John began exclusively trading futures and futures options for his own account. John later became a founding member of VI Capital, a proprietary trading company funded with personal and investor funds. At VI Capital, John was the director of risk management, technical analysis and strategy development. VI Capital realized multi digit returns over the course of 8 years of trading.

John has extensive trading experience in stock indexes, metals, commodities, energy and agriculture products. He believes that hard work reveals the best trading opportunities, and strong discipline creates consistent results. John possesses a unique ability to connect with customers, understand their goals, and work with them to create long and profitable relationships.

Contact John
Phone: 312-957-8108 or 888-391-7894
Email: jlunney@walshtrading.com

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