DTN Cattle Six Factors

TREND: The trend in August live cattle is steady to somewhat lower.

NONCOMMERCIAL OUTLOOK: Noncommercial traders held a net long futures position of 86,836 contracts in live cattle complex for the week ending May 26th, a decrease of 4,053 contracts as traders were extremely cautious as they didn’t want to become too bullish this past week and then be in a vulnerable position if the market’s fundamentals didn’t prevail.

COMMERCIAL OUTLOOK: On the futures board, commercials remain moderately short in live cattle as of May 26th likely hedged positions. Packers were able to get cattle bought cheaper this past week which delighted them after paying more in the cash market this past month.

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

PRICE PROBABILITY: The most active futures contract (August) fell one point to the 87th percentile as the contracts were leery of being too optimistic if the market’s fundamentals didn’t improve.

VOLATILITY: The three-month price volatility for June live cattle remained steady at the 6th percentile as the futures market was reluctant to be too bullish.