Technically Speaking

Weekly Analysis: Livestock Markets

Source: DTN ProphetX

Live Cattle: The December contract closed $5.60 lower at $97.45. Dec live cattle posted a new contract low of $96.10 last week, extending the secondary (intermediate-term) downtrend. Weekly stochastics are below the oversold level of 20%, but still well above single-digits. This would imply that despite being oversold the market could still work lower. Market volatility remains high, climbing to 20.2% last week.

Feeder Cattle: The November contract closed $7.125 lower at $115.65. Nov feeders posted another new contract low of $114.65 last week. Weekly stochastics are below the oversold level of 20% and nearing single-digits. While the market could turn at any time, there is no indication of a change in trend.

Lean hogs: The more active December contract closed $0.375 lower at $42.225 last week. Dec hogs posted an inside range last week, again signaling it could be in the process of changing its secondary (intermediate-term) trend. Weekly stochastics are in single digits and nearing a bullish crossover that would indicate a possible uptrend.

Corn (Cash): The DTN National Corn Index (NCI.X, national average cash price) closed at $3.11 1/2, up 14 cents for the week. The secondary (intermediate-term) uptrend continues to strengthen. Initial resistance on the weekly close chart is $3.12 1/2, a price that marks the 23.6% retracement level of the previous downtrend from $4.00 1/2 through the low of $2.85 1/4. The 33% retracement level is up near $3.23 1/2.

Soybean meal: The December contract closed $0.40 higher at $300.60. Dec meal continues to indicate a bullish change in its secondary (intermediate-term) trend is in progress. Weekly stochastics remain bullish, in single digits and well below the oversold level of 20%, while the futures contract holds near support at $303.00. This price marks the 76.4% retracement level of the previous uptrend from $267.20 through the high of $418.70. Look for another week of consolidation between $294.10 and $310.90.

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