Livestock Futures Targeting Technical Levels As Holiday Trade Here

December 19, 2019 08:00 AM
Volume has slowed down considerably in livestock futures
Lean Hog futures chart friendlier, but bulls need more of a technical confirmation
Meats Market Update


Livestock Futures Commentary

Live Cattle (February)

Live cattle futures were mixed with the February contract trading near unchanged, by the close. Volume has slowed down considerably with the holiday just around the corner, but that could change with some fundamental headlines coming down the pipeline. We’ve started to see some sales at 120 live and 190 dressed this week, including a pen of 268 head on today’s Fed Cattle Exchange. Attention is now turning to Friday’s Cattle on Feed report, the estimates are as follows:

On Feed: 101.2-102.9, average 101.9

Placements: 98.7-107.10, average 101.0

Marketings: 96.6-98.7, average 97.2

Boxed beef took another hit today with choice down 3.24 at 209.57, select down 1.90 at 201.57. With the market little changed today, many of the technicals remain intact. 126.925-127.15 is our pivot pocket going into tomorrow’s trade. If the bears can continue to defend this, we could see a retest to the bottom end of the recent range, 123.125-123.85. Consecutive closes above likely takes us to new contract highs.

Feeder Cattle (January)

January feeder cattle continued to retreat today, marking the third consecutive down day. To keep things in perspective, that has only amounted to giving back roughly half of Friday’s gains. Prices remain trapped within our support and resistance levels, wee see support coming in from 143.275-143.70, previously resistance. Our 4-star resistance pocket remains intact from 146.85-147.975.

Resistance: 146.85-147.975****

Support: 143.275-143.70****, 141.50-142.00**

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Lean Hogs (February)

February lean hogs finished the day near unchanged, in our pivot pocket, 69.325-70.05. The chart is starting to become friendlier, but the bulls need to see more of a technical confirmation. If the bulls can achieve consecutive closes above 70.05, we would expect to see another leg higher. First resistance comes in from 72.025-72.275, this pocket represents the 50 and 100-day moving average. If the bulls can chew through this pocket, we would expect to see a continuation towards 73.95-74.35. This pocket represents the gap and the breakdown point from November 14th, along with a key retracement.

Resistance: 72.55-72.850**, 74.00-74.525****

Support: 69.325-70.05****, 65.40-66.50****, 63.675**

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