The August Lean Hogs contract bounced back from Thursdays debacle. It recovered most of the decline and settled above the 80.45 resistance level at 80.65. It formed an inside candle as it traded within Thursdays trading range. A break out above the 81.15 high could see price retest the rising 100 DMA now at 82.97. A failure from settlement could see price test the 79.50 low and then the rising 8 DMA at 78.94. The Lean Hog Index declined and is at 70.65 as of July 10th. The pork cutout index recovered to 72.61 as of July 11th.
August Live Cattle eked out a new high for the up move at 108.725. It settled at 108.475. This is right at the 108.65 resistance level that cattle has been nearing all week. If cattle can take out this level next week a run to resistance at 110.80 is likely. Resistance then comes in at 112.35. A failure from settlement could see price revisit the 107.30 support level and then move towards support at 106.025. The cash market has traded at 112.00 in the south on a live basis. It has traded at 115.00 in Iowa on a live basis and at 182.00 -183.00 for dressed in Nebraska. Boxed beef cutouts declined again as choice cutouts were down 0.97 to 212.80 and select was down 1.19 to 189.60 on light to moderate demand and moderate offerings. The choice/ select spread widened to 23.20 and the load count was 109. Slaughter was 116,000.
August Feeder Cattle broke down and tested support at 140.775 making the low of the day just below it at 140.45. It recovered off the low and settled at 141.60. Resistance is at 142.40 and 143.50. The high for the week is at 143.75. The 100 DMA is at 144.69. Support is at 140.775 and the rising 8 DMA at 140.45. The declining 50 DMA is at 139.84. The cash index has recovered nicely off its lows. Corn is strong and volatile. Feeder Cattle is coiling between support and resistance. Corn prices could play an important role in the break out direction for Feeders. The Feeder Cattle Index continued it move higher and is at 141.06 as of July 11th.
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Senior Market Strategist
Walsh Trading, Inc.
RISK DISCLOSURE: THERE IS A SUBSTANTIAL RISK OF LOSS IN FUTURES AND OPTIONS TRADING. THIS REPORT IS A SOLICITATION FOR ENTERING A DERIVATIVES TRANSACTION AND ALL TRANSACTIONS INCLUDE A SUBSTANTIAL RISK OF LOSS.THE USE OF A STOP-LOSS ORDER MAY NOT NECESSARILY LIMIT YOUR LOSS TO THE INTENDED AMOUNT. WHILE CURRENT EVENTS, MARKET ANNOUNCEMENTS AND SEASONAL FACTORS ARE TYPICALLY BUILT INTO FUTURES PRICES, A MOVEMENT IN THE CASH MARKET WOULD NOT NECESSARILY MOVE IN TANDEM WITH THE RELATED FUTURES AND OPTIONS CONTRACTS.