Technically Speaking

Weekly Analysis: Livestock Markets

Live Cattle: The December contract closed $4.25 lower at $130.675. Despite the rally seen late in the week the contract moved to a new low of $127.425, reestablishing a secondary (intermediate-term) downtrend. Weekly stochastics are neutral-to-bearish indicating continued pressure could be seen. The major (long-term) trend remains down with support near $126.50, the 50% retracement level of the previous major uptrend from $80.225 through the high of $172.75. Monthly stochastics continue to show the market is oversold and could soon stabilize.

Feeder Cattle: The more active January contract closed $7.475 lower at $164.55. The contract posted a new low of $160.775 last week, reestablishing a secondary (intermediate-term) downtrend on its weekly chart. However, weekly stochastics are neutral-to-bearish above the oversold level ow 20%, indicating continued pressure could be seen. The major (long-term) trend remains down with next support between $146.675 and $138.825, prices that mark the 61.8% and 67% retracement levels of the previous uptrend from $85.45 through the high of $245.75. Monthly stochastics have been pulled below the oversold level of 20%.

Lean hogs: The December contract closed $0.20 lower at $54.80 last week. The secondary (intermediate-term) trend remains down as the contract posted a new low of $52.80 before rallying late in the week. The next major (long-term) low is $43.575 from August 2009.

Corn (Cash): The DTN National Corn Index (NCI.X, national average cash price) closed at $3.36, down 13 cents for the week. The move to a new 4-week low turned the secondary (intermediate-term) trend sideways-to-down. Support is now pegged between $3.29 and $3.23, prices that mark the 61.8% and 67% retracement levels of the previous rally from $2.81 through the high of $4.06.

Soybean meal: The December contract closed $6.90 lower at $288.80. The secondary (intermediate-term) trend remains down as Dec meal moved to another new low of $288.30. 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.

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