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While traders see cash cattle trading near $95.00 this week in the southern plains, August cattle closed at 92.65 so the discount may provide some support. Traders remain nervous that the aggressive long liquidation selling from fund traders seen on Monday could re-emerge as a bearish force. Funds held a hefty net long position as of July 20th basis the COT reports. August live cattle ended the pit-session near unchanged yesterday, after trading in the bottom portion of Monday’s big range-down session throughout the day. Higher equity values and even stronger boxed beef prices offered little support to the cattle market, as it was still reeling from Monday’s steep sell-off. Cash live cattle were quiet, with offers at $96, $1 higher than last week’s trade. Bids were at $94 on Monday, but there were no bids yesterday. The estimated cattle slaughter came in at 125,000 head yesterday which was below trade expectations and could be a sign of weaker packer demand. This brings the total for the week so far to 254,000 head, down from 256,000 head last week at this time but up from 252,000 head a year ago. Boxed beef cutout values at mid-session came in at $155.62 and closed at $155.23, up 0.33 for the session and up to the highest level since July 22nd. This was up from $155.10 the prior week. The market seems to be in a supply set-up to move higher, as long as demand manages to hold near current levels. Heat in the central part of the country for a few more days could keep demand sluggish. A forecast for a trough for the eastern part of the country for the next 10 days or so could help pull temperatures and humidity levels down on the East Coast, which may be seen as a positive for demand.
TODAY’S GUIDANCE: The overbought condition and the aggressive fund selling trend seen Monday are bearish short-term forces. If we see the selling trend continue into the middle of this week, the market might correct the overbought condition. A correction in October cattle to 92.65 support looks like a short-term buying opportunity, with 95.97 as the next upside target.
Cattle Market Commentary – 2010.07.28
by Terry Roggensack on July 28, 2010
Below is a sample of our Daily Commentary. To get this comment, and our daily coverage of 15 additional markets and trade ideas, visit futures-research.com for your free 2 week trial!
While traders see cash cattle trading near $95.00 this week in the southern plains, August cattle closed at 92.65 so the discount may provide some support. Traders remain nervous that the aggressive long liquidation selling from fund traders seen on Monday could re-emerge as a bearish force. Funds held a hefty net long position as of July 20th basis the COT reports. August live cattle ended the pit-session near unchanged yesterday, after trading in the bottom portion of Monday’s big range-down session throughout the day. Higher equity values and even stronger boxed beef prices offered little support to the cattle market, as it was still reeling from Monday’s steep sell-off. Cash live cattle were quiet, with offers at $96, $1 higher than last week’s trade. Bids were at $94 on Monday, but there were no bids yesterday. The estimated cattle slaughter came in at 125,000 head yesterday which was below trade expectations and could be a sign of weaker packer demand. This brings the total for the week so far to 254,000 head, down from 256,000 head last week at this time but up from 252,000 head a year ago. Boxed beef cutout values at mid-session came in at $155.62 and closed at $155.23, up 0.33 for the session and up to the highest level since July 22nd. This was up from $155.10 the prior week. The market seems to be in a supply set-up to move higher, as long as demand manages to hold near current levels. Heat in the central part of the country for a few more days could keep demand sluggish. A forecast for a trough for the eastern part of the country for the next 10 days or so could help pull temperatures and humidity levels down on the East Coast, which may be seen as a positive for demand.
TODAY’S GUIDANCE: The overbought condition and the aggressive fund selling trend seen Monday are bearish short-term forces. If we see the selling trend continue into the middle of this week, the market might correct the overbought condition. A correction in October cattle to 92.65 support looks like a short-term buying opportunity, with 95.97 as the next upside target.
Tags: Cattle, Livestock
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