Shootin’ The Bull

Offering technical & mechanical analysis of the commodity market, for the improvement of risk management.

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“Shootin’ The Bull”

Commodity Market Comments

by Christopher B. Swift

July 24, 2017

Live Cattle:

 Demand appears to be so robust, that it took everything traders had to push it limit down, and by the close, could not lock it.  While the placements are focused towards the November and December time frame, the current demand is anticipated to keep buyers busy.  So, since it appears that backgrounders didn’t have to sell inventory under duress, and feed yards maybe wanted the inventory, as reflected in them paying up for them, shouldn’t that be a sign of strength and not weakness?  While the increase in supply may seem burdensome, it hasn’t been all year.  The industry will find out a great deal about its health over the next few weeks.  A trade to new highs would suggest the environment to be as friendly as it has ever been.  A trade under the June low would suggest the environment to be weakened from the additional supply and caution would be exercised.  With multiple positions having been stopped out from last weeks recommendations, I am going to stay flat for another day to see what transpires.  Lastly, the ability to trade today, whether the contract month you are in or wanted to spread, it allowed for no building of pressure.  Not to say futures won’t be lower at some point tomorrow, but it won’t be due to left over sales from today.

Feeder Cattle:

Feeders were most likely impacted by the inventory number than the on feed.  For this year, that may not mean as much.  With the pull being so great on inventory, the likelihood of building another wall of cattle appears minimal.  While there may be greater numbers in 2018, with such heavy placements this year, I have to wonder how many more there are out there that ready to go?  The lower trade disrupted the intermediate wave count.  Not to any great extent, but changed it nonetheless.  Most likely this will be a prolonging of the wave 4.  More clues are anticipated to be brought forth tomorrow.

Corn:

Corn was lower, but has done nothing to suggest a higher or lower trade.  One thing to keep in mind for corn is that it has been stuck for nearly 24 months in a $.64 range.  With the bottom side limited to zero, and intrinsic value near $3.50, it appears the upside is the one to watch out for.  Lastly, Dennis Gartman is an analyst I’ve known and followed for years.  I respect his opinion and his comments today were refreshing. Dennis Gartman Comments.


Crude:

Crude firmed today.  It remains very range bound.

S & P 500 Stock Index:

The technical indicators are waning on the S&P 500.  Were another new contract/historical high made, I will be looking to take an initial options position using the 2400 September puts.  They are trading around $13.50 or $675.00 per option.  They expire on the 15th of September.  I chose the shorter time frame first to see how close, or not, to a top the market is. If you have an interest in hedging a stock portfolio, 401K or retirement plan, contact me and I will be glad to explain any details of this trade.

New Account Forms

Live account forms on line. They are very simple to use and can be filled out in a matter of minutes. I look forward to earning your business. If you have any questions or would like further information, please feel free to contact me at anytime.

FutureSource:

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Being a commodity broker introduces me to all aspects of agricultural production.  Crop insurance is one of those aspects and it has been a pleasure watching my son excel in this field.  Although Swift Trading Company is not associated with C & H Insurance, I have no reservation recommending Will’s expertise and the services he provides.
C & H Insurance Commitment
With the recent changes made in crop insurance programs, C&H Insurance is even more determined to provide outstanding service to its clients.  Keeping abreast of the ever changing and challenging agricultural environment, we attempt to expose risk and capitalize on opportunities.  The personal services provided by Will Swift at C & H Insurance are listed below:
  1. Help determine the level of coverage and type of insurance plan by:
  • Analyzing your current financial situation and taking current breakeven goals into consideration
  • Analyzing your current marketing plan. This includes, your current positions, future sale goals, and how potential market changes will affect your marketing plan.  Then we make the extra effort to make sure the insurance plan you choose now will still be the right choice at harvest.
  • Analyzing land locations to determine what the best unit structure would be for that current year and where your greatest risk lies.
  1. Mapping of your planted acres and record keeping in book form.
Products offered to C&H clients include:
  1. Catastrophic insurance
  2. Yield Protection
  3. Revenue Protection
  4. Revenue Protection Harvest Price Exclusion
  5. Group Risk Protection Plan
  6. Hail & Fire Insurance
  7. Livestock Risk Protection
  8. Livestock Gross Margin
  9. Pasture Range and Forage
To discuss your crop insurance options for the upcoming season, please contact Will Swift at 573-472-9948 or email William@cropNhail.com .
I look forward to earning your business.
Will Swift

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.

Commodities Brokerage, Commodity Market Analysis, Hedging, Price Risk Management

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