Feeder cattle futures have been hovering at these levels for the better part of this month, but are having difficulty following through above $2.20 per pound let alone come close to challenging last year’s highs. The August feeder cattle contract closed down 120 points at $2.17 per pound at the Chicago Mercantile Exchange.
Feeder cattle “asking” prices have been reported to range nearly $100 per hundred-weight depending on what part of the country you’re in, but at the CME they have only been fluctuating between $2-$3 dollars in the past five weeks. Cattle futures may have picked up in the number of slaughtered animals this week, but is still well behind the pace of this time last year.
“Cattle futures are definitely at a cross-roads at this point,” said Nicholas Medina, a futures and options specialist for Capital Trading Group in Chicago, regarding the fundamental assessment of the cattle futures market. Medina added, “Cattle futures appear to have marked a double-top for the year in both January & April, and are showing weakness in challenging these highs – the way I see it.”
The trend in cattle futures is up, albeit with little follow-through on higher highs three times this month. The cattle futures market has been teetering back and forth for the past two months and I’m sidelined from this market until a clearer picture emerges.
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