Live Cattle: An overlapping of previous wave highs started today with October having traded under what is believed a wave 3 high made on 4/6. A trade of October under $235.90, made on 2/19, will add credibility that a top is in. The price structure of the board remains friendly towards forward marketing, even with a $10.00 haircut to the back end. The back end will be even more crucial to manage as cattle feeders this week laid in "the" most expensive inventory in history with a $10.00 haircut to the contract months they will be marketing these critters into. With the amount of working capital at stake, you don't need any further comments about whether prices are anticipated to move higher or lower. What you need is a plan to capture as much of the price available and the ability to live with your decisions.
Feeder Cattle: August feeder cattle remain in a questionable pattern. Mostly due to me questioning my wave count and where to start from. The small variations between fat and feeders in the March 13 - 26 time frame is what is in question. In the fats, it is clear there are 5 waves up on the close only chart. On the August feeder close only, there is a wave sequence that will make the difference between the top being in, or attempt to reach the level of the current index. For now, it appears that futures traders would like to have a little distance between where they assume your risk, and how much of you are currently assuming, as visible by the spreads at inception of production. I recommend watching the August feeder cattle close only chart to see if a Head & Shoulders pattern is formed over the next few days. A close of August at $366.05 will equal what is currently labeled the minor wave IV. This would form the right neck line, with an anticipation of a right shoulder to somewhere on a close between $370.00 and $373.00. A new high close would signal the wave count below as correct, however, it would become even more crucial to be marketing heavily into the future. The next few days are expected to be very interesting.
Corn: A higher start for the day fizzlied at the close. Both corn and beans lost a little ground. Wheat was able to keep some of their gains. I continue to be friendly towards all three, and maintain previous recommendations.
Energy: Energy is higher again today. I anticipate energy to continue higher. The excessive price ranges are anticipated to continue with at anytime a dramatic change to be anticipated, due to the volatility of the President and his actions.
Bonds: Bonds are a tad lower. Bonds are believed to have completed a wave 2 correction of the move to new contract lows. The President has suggested to anticipate a check from the Tariffs. Scott Bessent also reminded everyone to increase their withholdings so the government can retrieve a large portion of that back. This act will be anticipated to increase core inflation, as those in need will spend it quickly. Along with the rising commodity inflation, and the Presidents desire to lower rates, there is not much on the horizon to quell inflation. So, prepare for more inflation.
Christopher B. Swift is a commodity broker and consultant with Swift Trading Company in Nashville, TN. Mr. Swift authors the daily commentaries "Mid Day Cattle Comment" and "Shootin' the Bull" commentary found on his website @ www.shootinthebull.com
This is intended to be or is in the nature of a solicitation.” Futures trading is not for everyone. The risk of loss in trading futures can be substantial; therefore, carefully consider whether such trading is suitable for you in light of your financial condition. Past performance is not indicative of future results, and there is no assurance that your trading experience will be similar to the past performance.
