Last week's market didn't pan out as cattlemen had hoped. The futures market veered lower, cash cattle traded $1 lower and boxed beef prices made a seasonal top. Heading into the last weeks of December, the market may trend like this until the new year.
Last week's cash cattle trade was probably the most disappointing as feedlots had hoped to add another $1 to $2 to the market. Upon calculating their showlists for the week, feedlots waited patiently until Wednesday to start selling cattle. Hearing rumors from packers that, for the week of Christmas, they intend to kill very few cattle, feedlots grew anxious and began to sell. The dangerous thing about market rumors is that they very seldom are true, and they are even less likely to share positive news and more likely to share bearish fears. The fact remains that markets are traded by people, and people are emotional, but the less we can make decisions on an emotional whim, the better.
Along with a lower trading cash cattle market, the futures market also scaled lower. With both the live cattle and feeder cattle contracts coming up against nearby resistance levels, the market lost its support as the week progressed and traders let the contracts fall lower. With cash cattle trading lower, boxed beef prices printing lower and a less-than-exceptional export report on Thursday, the market trailed into Friday's close disappointed and unsupported.
In between the Christmas and Thanksgiving holiday is an odd time for the market. There are a lot of short weeks where traders opt to head out for a long weekend; packers slaughter fewer cattle and the market's trading time is cut short. Understanding how the holidays can pressure the marketplace is vital and it's important to keep in perspective what's true market data and facts, and what are just holiday jitters affecting the market.
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ShayLe Stewart can be reached at firstname.lastname@example.org
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