DTN Cattle Six Factors

TREND: The trend in February live cattle is higher.     

NONCOMMERCIAL OUTLOOK: Noncommercial traders held a net-long futures position of 109,575 contracts in live cattle for the week ended Oct. 21 — as traders continued to be keenly aware of the market’s long-term bullish outlook, all while understanding the level of risk and volatility that’s embedded at the market at these prices points.

COMMERCIAL OUTLOOK: On the futures board, commercials remain moderately short in live cattle as of Oct. 21 — likely hedged positions.

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

PRICE PROBABILITY: The most-active futures contract (February) gained seven points to the 85th percentile, as traders note the positive uptick in the market’s fundamentals.

VOLATILITY: The three-month price volatility for February live cattle fell one point to the 7th percentile as traders recognize the technical vulnerability in the market but are still acknowledging the market’s positive fundamental outlook from a long-term perspective.