Technically Speaking

Monthly Analysis: Livestock Markets

By Darin Newsom , DTN Senior Analyst
Source: DTN ProphetX

Live Cattle: The April contract closed at $139.50, up $5.50 on the monthly chart. The market still looks to be in the early stages of a major (long-term) 5-Wave (Elliott Theory) uptrend. However, April live cattle are already testing resistance between $138.90 and $141.375, prices that mark the 33% and 38.2% retracement levels of the previous downtrend from $172.75 (November 2014) through the low of $121.975 (December 2015). With the April nearing a secondary (intermediate-term) peak, Wave 1 could soon come to an end.

Feeder Cattle: The April contract closed at $158.15, up $0.90 on the monthly chart. The market continues to indicate it has moved into a 5-Wave uptrend (Elliott), though Wave has already tested resistance near $165.15. This price marks the 23.6% retracement level of the previous downtrend from $245.75 through the December low of $143.20. Support remains near $146.70.

Lean Hogs: The April contract closed at $69.975, down $0.725 on the monthly chart. Wave 1 of the major (long-term) uptrend may be coming to an end after the April contract tested resistance near $70.925 during February. This price marks the 23.6% retracement level of the previous downtrend from $133.825 (April 2014) through the low of $51.80 (November 2015). Next resistance is at the 33% retracement level near $78.775. Initial support is near $65.425.

Corn (Cash): The DTN National Corn Index (NCI.X, national average cash price) closed at $3.29 1/4, down 19 1/4 cents for the month. The major (long-term) trend is sideways with support pegged near $3.23. This price marks the 67% retracement level of the rally from the low of $2.81 1/2 (October 2014) through the high of $4.05 3/4 (July 2016). If this support fails to hold, next support is at the October 2014 low. Monthly stochastics are approaching the oversold level of 20%.

Soybean meal: The May contract closed at $262.50, down $9.90 on the continuous monthly chart. The major (long-term) trend remains down after posting another new low of $258.90 during February. Monthly stochastics remain in single digits reflecting a sharply oversold situation, setting the stage for a bullish crossover at some time.

To track my thoughts on the markets throughout the day, follow me on Twitter: www.twitter.com\DarinNewsom

Comments

To comment, please Log In or Join our Community .