More Leg to Breakdown?
Feeder Cattle
Technicals (August - Q)
August feeder cattle futures posted their second consecutive inside day (trading within the previous day's range). Despite the consolidation in the last two sessions, the RSI remains in oversold territory with a reading of 26.12, the lowest since last November, which was right before the last dip lower before posting a low on December 7th. The lowest RSI during that time frame was 24.68. Is the RSI a good enough reason to be Bullish from these levels, short answer is no. With that said, we continue to believe we could see some relief from these levels that may setup for another opportunity to the sell side for those with a bearish bias or for those that need to hedge. The CME CVOL index, a measure of volatility, is at its highest levels since the Spring, it would be nice to see that subside which could help options become a little less expensive. The chart below includes a set of Fibonacci retracements from this year's range. Not illustrated is a Fib retracement from the recent selloff, the halfway back point on that would come in near 249.15.
Resistance: 245.925-246.675***, 249.15-250.92****
Pivot: 244.275
Support:240.775-240.925****, 237.80-237.97** 229.50****
Check out CME Group real-time data plans available on TradingView here: tradingview.com/cme/
Disclaimers:
CME Real-time Market Data help identify trading set-ups and express my market views. If you have futures in your trading portfolio, you can check out on CME Group data plans available that suit your trading needs tradingview.com/cme/
*Trade ideas cited above are for illustration only, as an integral part of a case study to demonstrate the fundamental concepts in risk management under the market scenarios being discussed. They shall not be construed as investment recommendations or advice. Nor are they used to promote any specific products, or services.
Futures trading involves substantial risk of loss and may not be suitable for all investors. Trading advice is based on information taken from trade and statistical services and other sources Blue Line Futures, LLC believes are reliable. We do not guarantee that such information is accurate or complete and it should not be relied upon as such. Trading advice reflects our good faith judgment at a specific time and is subject to change without notice. There is no guarantee that the advice we give will result in profitable trades. All trading decisions will be made by the account holder. Past performance is not necessarily indicative of future results.
Technicals (August - Q)
August feeder cattle futures posted their second consecutive inside day (trading within the previous day's range). Despite the consolidation in the last two sessions, the RSI remains in oversold territory with a reading of 26.12, the lowest since last November, which was right before the last dip lower before posting a low on December 7th. The lowest RSI during that time frame was 24.68. Is the RSI a good enough reason to be Bullish from these levels, short answer is no. With that said, we continue to believe we could see some relief from these levels that may setup for another opportunity to the sell side for those with a bearish bias or for those that need to hedge. The CME CVOL index, a measure of volatility, is at its highest levels since the Spring, it would be nice to see that subside which could help options become a little less expensive. The chart below includes a set of Fibonacci retracements from this year's range. Not illustrated is a Fib retracement from the recent selloff, the halfway back point on that would come in near 249.15.
Resistance: 245.925-246.675***, 249.15-250.92****
Pivot: 244.275
Support:240.775-240.925****, 237.80-237.97** 229.50****
Check out CME Group real-time data plans available on TradingView here: tradingview.com/cme/
Disclaimers:
CME Real-time Market Data help identify trading set-ups and express my market views. If you have futures in your trading portfolio, you can check out on CME Group data plans available that suit your trading needs tradingview.com/cme/
*Trade ideas cited above are for illustration only, as an integral part of a case study to demonstrate the fundamental concepts in risk management under the market scenarios being discussed. They shall not be construed as investment recommendations or advice. Nor are they used to promote any specific products, or services.
Futures trading involves substantial risk of loss and may not be suitable for all investors. Trading advice is based on information taken from trade and statistical services and other sources Blue Line Futures, LLC believes are reliable. We do not guarantee that such information is accurate or complete and it should not be relied upon as such. Trading advice reflects our good faith judgment at a specific time and is subject to change without notice. There is no guarantee that the advice we give will result in profitable trades. All trading decisions will be made by the account holder. Past performance is not necessarily indicative of future results.
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