Live Cattle (Cash Index): The live cattle cash index sill looks to be moving toward a major (long-term) downtrend after posting what looks to be a double-top at $190 during July and extending its selloff to $183 during August. A double-top would be confirmed with a move below the previous 4-month low of $181. Theoretical Positions: Hedgers likely rolled put options up during the previous major uptrend and sold cash as needed. Cash cattle could continue to be sold.
Feeder Cattle (Cash Index): The index looks to be moving toward a major downtrend, with the previous 4-month low at $239.45 (May 2024). The index finished August at $242.95. Theoretical Positions: As with live cattle, hedgers have likely continued to roll put options up and sell cash.
Lean Hogs (Cash Index): I’m still not seeing anything concrete with the lean hog cash index other than an extended series of lower highs and lower lows. By definition this is a downtrend. Theoretical Positions: Cash hogs could continued to be sold.
