Investing.com reports that this morning’s economic data was a ‘goldilocks’ number, initially causing interest rates to lower, which in turn supported risk assets.
In the Live Cattle market, a risk-off trade characterized the end of the month, potentially adding pressure to the cattle complex. Despite weakness throughout most of the session, the last 30 minutes saw a constructive market effort to defend the previous day’s lows. We have been cautious regarding cattle prices against the May/June/July highs (189.47-190.075), but the recent pullback has brought us closer to a value zone. As long as external markets do not experience a prolonged risk-off trade, we anticipate strong support in the cattle market within the range of 184.55-185.20. However, there are headline risks that could trigger a change, so risk management is crucial. Resistance levels are identified at 189.47-190.075 and 191.47-191.62, with pivot points at 187.675-188.00. Support levels are noted at 184.55-185.20 and 182.82-183.325. The Daily Cattle and Beef Summary indicates that cutout values softened on Thursday afternoon, with choice cuts falling 1.84 to 317.60 and select cuts down by 3.95 to 285.37. The 5-area average price for live steers was reported at 189.79, remaining mostly stable for the week. Thursday’s slaughter was reported at 121,000 head, 3,000 less than the previous Thursday and 5,000 less than the same day last year. The week-to-date slaughter stands at 490,000, compared to 491,000 last week and 500,000 the year before. A Seasonal Tendency Update shows historical price averages for February futures across 5, 10, 15, 20, and 30-year timeframes. The chart suggests that the first half of November is typically difficult for the market to achieve a significant rally. The volatility remains relatively low, making options an attractive tool for managing risk or expressing market opinions with limited risk. January feeder cattle faced another challenging day in trade, dropping to and defending the first support level from 239.62-240.15. The ability to maintain this support led to an impressive last half hour of trade. If the Bulls can leverage yesterday’s close as a strength, a retest of the pivot level from 242.75-243.77 could be expected. Resistance levels for January feeder cattle are 246.82-247.60 and 249.85-250.80, with the pivot at 242.75-243.77. Support levels are 239.62-240.15 and 237.50-237.95. Looking at historical price averages for January futures, November appears to be a month of choppiness and indecisiveness for price trends. Stay ahead by subscribing to our daily Livestock Roundup for exclusive insights into Feeder Cattle, Live Cattle, and Lean Hogs. Gain access to proprietary trading levels and actionable market biases delivered to your inbox every day.Blue Line Futures offers free futures market research for investors. Futures trading carries a significant risk of loss and may not be suitable for all. It is crucial to assess whether such trading aligns with your financial status. Our trading advice is derived from reliable sources, including trade and statistical services, yet we cannot guarantee the accuracy or completeness of this information. It is not to be solely relied upon. Our advice is based on good faith judgment at a specific time and is subject to change without notice. We do not guarantee profitable trades, and all trading decisions are made by the account holder. Remember, past performance is not indicative of future results.
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