The cattle markets opened weak from the start yesterday, sliding through key 40 day moving averages in both Feb and April live cattle futures within the first half hour of the session and touching off sell stops. We did see a widespread cash cattle trade develop midday at mostly $208-210 dressed in the North and $134 live in the South, up $2 versus last week and in sharp contrast to cascading futures, which closed $1.50+ lower and then another $0.80 worth of losses through the afternoon hours. The move has the look of a technical flush and chart traders now eye the giant chart gap left back on Dec 21, which resides from $127.17 to $130.30 in April live cattle. The fact that futures couldn’t rally yesterday on the appearance of positive cash cattle news raises some red flags and anxiety levels. And this morning, we’re again facing more problems from much weaker global equity and commodity markets. Look for a lower start again this morning.
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