DTN Cattle Six Factors

TREND: The trend in April live cattle is steady/somewhat higher.     

NONCOMMERCIAL OUTLOOK: Noncommercial traders held a net-long futures position of 89,349 contracts in live cattle for the week ended Jan. 20, an increase of 3,410, as traders continued to be keenly aware of the market’s long-term bullish outlook, but also are aware of the market’s nearby resistance.

COMMERCIAL OUTLOOK: On the futures board, commercials remain moderately short in live cattle as of Jan. 20, likely hedged positions. It was assumed that fed cash cattle prices would trade higher this week, and luckily feedlot managers were able to see prices trade anywhere from steady to $5.00 higher.  

SEASONAL INDEX: Cash cattle prices tend to peak in March and bottom in October.

PRICE PROBABILITY: The most active futures contract (April) gained four points to the 92nd percentile as traders are pleased to see the uptick in fed cash cattle prices.  

VOLATILITY: The three-month price volatility for April live cattle remained steady at 6% as traders recognize the technical vulnerability in the market but are still acknowledging the market’s positive fundamental outlook from a long-term perspective.