Live Cattle: The December contract closed $6.80 lower at $134.925. As discussed last week, the minor (short-term) trend did turn down resulting in a sharp sell-off. Support is near $133.65, a price that marks the 67% retracement level of the rally from $128.10 through the recent high of $144.725. However, given the minor downtrend could see three lower weekly closes, and last week's was the second consecutive, this week could see Dec live cattle test support at the 76.4% retracement level near $132.00. This should spark continued noncommercial short-covering, with last Friday's CFTC Commitments of Traders report showing this group reducing their net-short futures holdings by 1,277 contracts.
Feeder Cattle: The more active January contract closed $11.175 lower at $172.025. Similar to live cattle, the minor (short-term) downtrend in feeder cattle should continue through at least early this week. This has turned the secondary (intermediate-term) uptrend sideways, looking for a third consecutive lower weekly close against the previous uptrend. Secondary support is between $171.85 and $169.575, prices that mark the 67% and 76.4% retracement levels of the previous rally from $164.05 through $187.50. Weekly stochastics are neutral, posting a bearish crossover above the oversold level of 20%.
Lean hogs: The December contract closed $4.20 lower at $55.00 last week. The secondary (intermediate-term) trend remains down as the contract posted a new low of $53.925. Major (long-term) support is at $54.10, the low from November 2010.
Corn (Cash): The DTN National Corn Index (NCI.X, national average cash price) closed at $3.49, down 6 cents for the week. Despite the lower weekly close the secondary (intermediate-term) trend remains sideways-to-up. Trendline support is pegged this week at $3.47, with support expected to come from a continued firming of national average basis. Last Friday saw the NCI.X come in 24 cents under the close of the December futures contract, 4 cents stronger than the previous Friday's 28 cents under. Resistance remains at $3.67, the 50% retracement level of the previous sell-off from $4.06 (week of July 13) through the low of $3.28 (week of August 31).
Soybean meal: The December contract closed $8.70 lower at $295.70. The secondary (intermediate-term) trend remains down as Dec meal moved to another new low of $294.00. Though weekly stochastics already indicate an oversold situation, next support is at the contract low of $286.00. Major (long-term) support on the market's monthly chart is at $295.10, then $275.40. The latter marks the low posted during December 2011.
The weekly Commitments of Traders report showed positions held as of Tuesday, November 3.
To track my thoughts on the markets throughout the day, follow me on Twitter: www.twitter.com\DarinNewsom