Jim Wyckoff: Fundamentals and Consumer Demand Continue to Support Cattle Futures09 October 2013
US - December live cattle closed down $0.37 at $131.95 Wednesday. Prices closed nearer the session high and saw mild profit taking from recent gains.
The key "outside markets" were in a fully bearish posture for the cattle market Wednesday, as the U.S. dollar index was sharply higher and crude oil prices were sharply lower.
Good consumer demand and bullish cash market fundamentals continue to support the cattle futures market. The U.S. government partial closure means a serious lack of livestock market information, which is casting a pall over the livestock futures markets. The uncertainty of this matter favors the bears.
The cattle futures bulls have the solid near-term technical advantage. Prices are in a nearly five-month-old uptrend on the daily bar chart. Bulls' next upside price "breakout" objective is to push and close prices above solid resistance at $134.00.
The next downside technical breakout objective for the bears is pushing and closing prices below solid technical support at $130.85. First resistance is seen at last week's high of $132.60 and then at $133.00. First support is seen at today's low of $131.70 and then at last week's low of $131.440. Wyckoff's Market Rating: 7.5
November feeder cattle closed up $0.05 at $166.37 Wednesday. Prices closed near the session high and closed at another fresh contract high close today.
The feeder bulls have the solid overall near-term technical advantage. The next upside price breakout objective for the feeder bulls is to push and close prices above solid technical resistance at $167.50.
The next downside price breakout objective for the bears is to push and close prices below solid technical support at $163.00.
First resistance is seen at last week's contract high of $166.50 and then at $167.00. First support is seen at today's low of $165.75 and then at this week's low of $165.35. Wyckoff's Market Rating: 8.0
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