Technically Speaking

Weekly Analysis: Livestock Markets

Source: DTN ProphetX

Live Cattle: The February contract closed $3.35 higher at $112.20. The market's secondary (intermediate-term) uptrend continues to strengthen. Weekly stochastics are bullish and below the overbought level of 80% indicating a possible extension of the uptrend to the next target of $117.75. This price marks the 50% retracement level of the previous downtrend from $137.75 through the low of $97.80.

Feeder Cattle: The January contract closed $2.25 higher at $127.225. The market's secondary (intermediate-term) uptrend continues to strengthen. Weekly stochastics remain bullish, well below the overbought level of 80%. The next price target is up at $130.40, the 50% retracement level of the previous downtrend from $150.15 through the low of $110.65.

Lean hogs: The February contract closed $2.575 higher at $56.75 last week. The market's secondary (intermediate-term) trend remains up with the next target at $58.825. This price marks the 50% retracement level of the previous downtrend from $70.125 through the low of $47.525. Weekly stochastics are bullish and still well below the overbought level of 80%.

Corn (Cash): The DTN National Corn Index (NCI.X, national average cash price) closed at $3.10 1/2, up 4 3/4 cents for the week. The secondary (intermediate-term) trend looks to be at the early phase of Wave 5 with initial resistance at the double-top (weekly close only) slightly below $3.12 1/2. This price marks the 23.6% retracement level of the previous downtrend from $4.00 1/2 through the low of $2.85 1/4. When the NCI.X breaks through this level the next target becomes the area between $3.23 1/2 and $3.29 1/2, the 33% and 38.2% retracement levels. At that time weekly stochastics should be well above the overbought level of 80%, setting the stage for the next downtrend.

Soybean meal: The January contract closed $10.50 higher at $323.10. The secondary (intermediate-term) trend remains up. Resistance is at the recent high of $329.80, then $354.60. The latter marks the 50% retracement level of the previous downtrend from $413.80 through the low of $295.40. Weekly stochastics are bullish, well below the overbought level of 80%.

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