“Shootin’ The Bull”

by Christopher B Swift

4/20/2026

Live Cattle:

Consumers are being impacted by inflation, whether core or commodity.  Even with energy inflation only 7 weeks old, the price hasn't gone down, or the actions that created the price to have ceased. It doesn't take much to cause someone to have to shift in discretionary spending.  The industry appears to be backing up, starting at the center of the plate.  Consumers have shifted with disposable income impacted.  Grocers and restaurants continue to raise prices, with grocers less than restaurants, and grocers now featuring some of the more expensive cuts.  The only reason you feature expensive cuts is because they are not moving.  Grocers and restaurants are becoming more creative to maintain customer loyalty.  Packers are believed to have been approximately $220.00 per head loss on last weeks slaughter and cattle feeders $160.00 per head loser.  With the noticeable shifts and changes in the aforementioned, I don't think it takes long for losses to trickle up the scale.  As cow/calf operations are starting to expand a little, and the price being paid for heifers and cow's with calves, the top sector of the industry needs more than anything, a sharply higher price.  Anything but will cause losses.

 

Last week produced what is believed to have been the marketing opportunity for the year with basis having narrowed, swapped in some cases, and new contract highs everywhere. Although volume was exceptionally heavy, and volatility immense, few found it interesting enough to maintain a position.  Today, basis has widened in a positive manner greatly to the back end, where cattle feeders just laid in last week the most expensive inventory in history. 

​

Next most probable move is anticipated to be a trade back to the March low, in quick fashion.  The Moore Research seasonality is negative into the first week of May.  Even with the new contract highs, the rally was counter seasonal, and can still produce a low trade within the next two weeks of the tendency.  Therefore, let's think forward just a few months.  If traders are able to push futures back to the lows made on March 9, it would create a right neck line equal to the left.  This would then lead me to anticipate the seasonal tendency coming back into play, but higher into the first week of July.  Think about a reversal that would look very similar to the price action of  11/24/25 to 4/14/26, but instead of going up, it goes down.  The chart below shows what a major head and shoulders reversal may look like.  

 

​Feeder Cattle:

​I believe that today's price action is more fundamentally motivated than technical.  That being, the projected negative margins simply grew to spreads for which no cattle feeder was willing to assume.  Hence, why feeders are down much more than fats, with not much news out today at all.   Backgrounders continue to have a beneficial bais spread, even if not nearly as good as when recognized last week.  As above, I anticipate a major head and shoulders pattern to form in the feeder cattle market.  If it does come to fruition, you need to make some decisions now as to whether you want to market at present, while still above or at the March, left shoulder high, or wait for the neckline and right shoulder to form, in hopes of the right shoulder being higher than the left. If waiting for the right shoulder to form, recall there needs to be about a $30.00 drop first, and then attempt to regain that, just to get to where you are right now. 

 

I recommend you take the chart pattern below to heart.  Adjust all marketing's going forward for just such a case as presented below and hope the consumer, packer, and cattle feeder will continue to support you entering into the widest projected negative margin ever assumed in cattle production.    

​

The new weekly high of the feeder cattle index forced a change of the previous wave count.  I have taken some time over the weekend to make adjustments for all waves to fit, as best as I can interpret.  With the divergence of price and technical indicators, showing the highest price on the lowest oscillator reading, cattle feeders are going to have to get really aggressive in bidding to make a new high and turn the oscillator higher.  Although futures may have a tendency for triple tops to not hold, cash tops may be able to, simply due to the financial risks being assumed for an indeterminable profit potential. 

​​​

​Corn:

​Beans slipped a little and wheat spreads between Chicago and KC were unwound.  Corn remained firm, and all in all, it was a pretty lackluster day in grains and oilseeds trading.  I don't expect this to last long as wheat is believed being impacted in drought areas.  I continue to recommend buying wheat with KC already having broken out to the upside and Chicago hot on its heels. A trade above $4.83 December corn will suggest to anticipate a higher trade.  Unlike energy, even if a component of, grain/oilseeds are not anticipated to move like energy does.  For the moment, I anticipate the commodity inflation and further funding of core inflation to keep a firmer tone under grains, even if not considered bullish.  Weather is what is anticipated to impact grains and oilseeds.  For them, this is just getting started. 

 

Energy:​

Energy was higher today.  I anticipate energy to continue higher.  Diesel fuel is in great demand and world supplies have been hampered. I continue to anticipate a new contract high, unfortunately, that would most likely mean an escalation in the middle east.  

​​​​​​​​​​​​​​​​​​​​​​​​​​​

Bonds:

It may not though as the government is pushing out hundreds of billions weekly through quantitative easing, a 7.5 billion dump into the system this morning, and fixing to hand out tariff payments to consumers with the clause, "you better update your withholdings'", so the government gets some of this back.  All timed instruments pulled of lows made on the opening Sunday evening, with bonds plus on the day, even if just by a tic.  Bonds should be going down, under current beliefs' of inflation, but they are not, and the President remains hellbent on lowering them further.  Therefore, I see no reason to not believe him and to expect more inflation. ​

​​​

​​​​​​​​​​ “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.

​​

​​

​