Technically Speaking

Weekly Analysis: Livestock Markets

Source: DTN ProphetX

Live Cattle: The February contract closed $4.825 higher at $115.35. The market's secondary (intermediate-term) remains up. Next resistance is at $117.775, a price that marks the 50% retracement level of the previous secondary downtrend from $137.75 through the low of $97.80. Weekly stochastics have moved above the overbought level of 80%.

Feeder Cattle: The March contract closed $3.80 higher at $126.30. The secondary (intermediate-term) trend remains up as the March contract closed above resistance at $125.80. This price marks the 50% retracement level of the previous secondary downtrend from $142.525 through the low of $109.075. With weekly stochastics still below the overbought level of 80%, an extension to the 67% retracement level near $131.40 is possible.

Lean hogs: The February contract closed $3.15 higher at $64.625 last week. The contract remains in a secondary (intermediate-term) uptrend as it tests resistance near $64.80. This price marks the 76.4% retracement level of the previous secondary downtrend from $70.125 through the low of $47.525. While the next target would be a full retracement back to the previous high, weekly stochastics are already nearing the overbought level of 80%. This could limit new buying interest.

Corn (Cash): The DTN National Corn Index (NCI.X, national average cash price) closed at $3.16, down 1 1/2 cents for the week. Despite the lower weekly close the secondary (intermediate-term) trend remains up. However, weekly stochastics are above the overbought level of 80% and nearing a bearish crossover. Such an event would signal the end of the secondary uptrend with the NCI.X sitting just below resistance near $3.23 1/2. This price marks the 33% retracement level of the previous secondary downtrend from $4.00 1/2 through the low of $2.85 1/4.

Soybean meal: The March contract closed $1.50 lower at $321.40. Despite the lower close the secondary (intermediate-term) trend remains up. However March meal has been unable to breach resistance at $332.80, a price that marks the 38.2% retracement of the previous secondary downtrend from $389.80 through the low of $297.60. The combination of still bullish weekly stochastics and an increasingly bearish carry in the March-to-May futures spread could result in continued consolidation on tits weekly chart.

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