Cattle did not have a good week this week. For that matter cattle have not had a good week since the end of June. Although the fundamentals are strong, the technicals are weak, which has resulted in the funds covering their long positions and reduce their net long holding in cattle.
The week started with cattle opening Monday’s session mixed with live cattle steady to firm while feeder cattle started steady to lower. It was a mostly uneventful session in cattle as traders looked for direction. Futures steep discount to cash helped to put support under cattle. While a sharply higher crude oil market and lower stock market added pressure. A strong session the grains added pressure. Cash traded between $247 and $248, a $7 to $8 decline from the previous week. The COT report showed the funds have been sellers as they trim their net long position.
Heavy selling hit the cattle market on Tuesday with cattle gapping lower and extending losses throughout the session. Early selling was tied to technical selling as the funds continue to trim their net long position in cattle. Fundamentally nothing has changed in the cattle market. Supplies remain tight, cash continues to remain firm, and demand remains strong. Futures remain weak due to expectations of events in the future, like an increase in interest rates and a slowing economy. Cash bids remain disappointing vs last week.
Wednesday’s session had cattle open steady to lower in the live cattle market while the feeder cattle contracts opened with small gains. Technical buying tried to give cattle a boost early in the session as traders tried to correct an oversold market condition. Favorable fundamentals tried to add support, but once the small traders’ buying dried up, all that was left was heavy fund selling. Light cash activity has been reported taking place at $240, which is $6 to $8 off last week.
Cattle closed out the week ending Thursday by opening the session higher but as been the case all week, cattle ran into a buzz saw and faded lower, extending session losses throughout the session. Technical buying helped cattle start higher, but once the small trader buying dried up, fund selling took over. August live cattle have closed lower for 15 straight sessions losing over $20.00. October live cattle have closed lower in 15 of the last 18 sessions (also dropping over $20). Sept feeder cattle have closed lower in 13 of the last 12 sessions (dropping over $35). Fundamentals remain friendly, technicals are oversold, but every rally gets met with heavy fund selling. At this point, cash and futures are not in line with each other and it will take some time for those to converge.
As of July 12, pasture and range conditions were rated at 30% g/e, 30% fair and 40% p/vp, down 3% from last week.
For the week, Aug closed at $224.425 down $10.775. Aug feeder cattle closed at $345.95 down $8.65.
Cattle Weekly Comments July 17
Cattle Weekly Comments July 17
Cattle did not have a good week this week. For that matter cattle have not had a good week since the end of June. Although the fundamentals are strong, the technicals are weak, which has resulted in the funds covering their long positions and reduce their net long holding in cattle.
The week started with cattle opening Monday’s session mixed with live cattle steady to firm while feeder cattle started steady to lower. It was a mostly uneventful session in cattle as traders looked for direction. Futures steep discount to cash helped to put support under cattle. While a sharply higher crude oil market and lower stock market added pressure. A strong session the grains added pressure. Cash traded between $247 and $248, a $7 to $8 decline from the previous week. The COT report showed the funds have been sellers as they trim their net long position.
Heavy selling hit the cattle market on Tuesday with cattle gapping lower and extending losses throughout the session. Early selling was tied to technical selling as the funds continue to trim their net long position in cattle. Fundamentally nothing has changed in the cattle market. Supplies remain tight, cash continues to remain firm, and demand remains strong. Futures remain weak due to expectations of events in the future, like an increase in interest rates and a slowing economy. Cash bids remain disappointing vs last week.
Wednesday’s session had cattle open steady to lower in the live cattle market while the feeder cattle contracts opened with small gains. Technical buying tried to give cattle a boost early in the session as traders tried to correct an oversold market condition. Favorable fundamentals tried to add support, but once the small traders’ buying dried up, all that was left was heavy fund selling. Light cash activity has been reported taking place at $240, which is $6 to $8 off last week.
Cattle closed out the week ending Thursday by opening the session higher but as been the case all week, cattle ran into a buzz saw and faded lower, extending session losses throughout the session. Technical buying helped cattle start higher, but once the small trader buying dried up, fund selling took over. August live cattle have closed lower for 15 straight sessions losing over $20.00. October live cattle have closed lower in 15 of the last 18 sessions (also dropping over $20). Sept feeder cattle have closed lower in 13 of the last 12 sessions (dropping over $35). Fundamentals remain friendly, technicals are oversold, but every rally gets met with heavy fund selling. At this point, cash and futures are not in line with each other and it will take some time for those to converge.
As of July 12, pasture and range conditions were rated at 30% g/e, 30% fair and 40% p/vp, down 3% from last week.
For the week, Aug closed at $224.425 down $10.775. Aug feeder cattle closed at $345.95 down $8.65.