Technically Speaking

Weekly Analysis: Livestock Markets

Live Cattle: The June contract closed $2.025 lower at $149.175 last week. The market remains a mix of technical signals. Weekly stochastics remain bullish following the establishment of a crossover below the oversold level of 20% the week of February 23. On the other hand, the contract itself posted a bearish reversal the week of April 6 with its high ($154.675) a test of resistance at $154.825. This price marks the 67% retracement level of the secondary downtrend from $162.925 through the low of $129.425. The for the market to continue its sideways with resistance between $150.75 and $154.825, and support at $146.175.

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Feeder Cattle: The August contract closed $0.60 lower at $215.075 last week. Despite its recent strength, the secondary trend remains down. However, the futures contract has given mixed signals of late, most notably a bearish reversal the week of April 6 followed by a bullish reversal the week of April 20. Resistance remains between $217.30 and $222.20, with support between $209.10 and $206.10.

Lean hogs: The June contract closed $1.80 higher at $81.25 last week. The secondary (intermediate-term) trend remains up. Initial resistance is pegged at $82.595, then $85.850. These prices mark the 38.2% and 50% retracement levels of the previous secondary downtrend from $99.65 through the low of $72.05. Weekly stochastics are bullish indicating the contract should extend its uptrend.

Corn (Cash): The DTN National Corn Index (NCI.X, national average cash price) closed at $3.43, down 4 cents for the week. The secondary (intermediate-term) trend is down with the NCI.X closing below its previous low of $3.44 and technical support at $3.47. The latter marks the 33% retracement level of the previous secondary uptrend from $2.81 through the high of $3.80. Given that weekly stochastics remain bearish the NCI.X could look to test support at the 50% retracement level of $3.31.

Soybean meal: The July contract closed $1.40 lower at $311.90 last week. The market remains in a secondary (intermediate-term) downtrend though July meal continues to hold above minor trendline support pegged this week at $308.90. Weekly stochastics are below the oversold level of 20% setting the stage for a potential bullish crossover that could signal a change in trend.

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