Livestock Futures: Monthly Technical Overview

Sample from Livestock Trader's Almanac for
July 2002 Livestock Fundamentals

Each month the Livestock Futures Almanac provides the reader with insight into the historical price behavior of the most active futures contract. This information may help commodity traders and hedgers make more more informed decisions regarding their market operations. Of course the Livestock Trader's Almanac also provides insightful fundamental commentary as well.

Live Cattle

October Live Cattle Futures 19 year Seasonal Average Years 1983 to 2001 settlement values used.	General Comments: July tends to end bearish trend from April – 19 Year Batting Average for October Contract is Up 14 & Down 5 – Especially strong July’s follow strong Junes – Weak Junes tend to see lower lows in July – If a strong July then expect higher highs in August, but don’t stay too long – July weakness tends to continue in August
	- 19 Year Monthly Performance Summary -
	# Years Up	14	# Higher Highs	12
	# Years Dn	5	# Lower Lows	5
	Total Change	18.50	# Expanded Range	13
	Avg Change	0.97	# Narrow Range	6
	Avg Gain	2.15
	Avg Loss	-2.35	5 yr high	71.45
	Avg Range	4.17	5 yr low	59.90

Feeder Cattle

September Feeder Cattle Futures 19 year Seasonal Average Years 1983 to 2001 settlement values used.	General Comments: Strongest month on record for Feeders – volatility tends to expand during the month – 13 out of the last 19 years have seen stronger monthly closes – Strongest July’s follow strong Junes – Following weak June’s, July tends to be flat – August tends to correct July enthusiasm – Volatility tends to contract following July
	- 19 Year Monthly Performance Summary -
	# Years Up	13	# Higher Highs	14
	# Years Dn	6	# Lower Lows	6
	Total Change	25.50	# Expanded Range	13
	Avg Change	1.35	# Narrow Range	6
	Avg Gain	2.87
	Avg Loss	-1.95	5 yr high	88.25
	Avg Range	4.72	5 yr low	59.00

Lean Hogs

October Lean Hog Futures 19 year Seasonal Average Years 1983 to 2001 settlement values used.	General Comments: Strong June’s often continue in July – Weak Junes tend to create summer dull drums – Following weak June’s, July often sees sharp breaks, and volatile markets though little net change – Expect strong July’s to continue into August, with July highs being violated – July lows tend to hold in August, especially in bull markets
	- 19 Year Monthly Performance Summary -
	# Years Up	10	# Higher Highs	7
	# Years Dn	9	# Lower Lows	12
	Total Change	-0.82	# Expanded Range	12
	Avg Change	-0.05	# Narrow Range	7
	Avg Gain	3.77
	Avg Loss	-4.27	5 yr high	75.45
	Avg Range	6.05	5 yr low	38.80

THE DATA CONTAINED HERE IN ARE BELIEVED TO BE RELIABLE BUT CANNOT BE GUARANTEED AS TO RELIABILITY, ACCURACY, OR COMPLETENESS; AND, AS SUCH ARE SUBJECT TO CHANGE WITHOUT NOTICE. CFEA WILL NOT BE RESPONSIBLE FOR ANYTHING, WHICH MAY RESULT FROM RELIANCE ON THIS DATA OR THE OPINIONS EXPRESSED HERE IN.

DISCLOSURE OF RISK: THE RISK OF LOSS IN TRADING FUTURES AND OPTIONS CAN BE SUBSTANTIAL; THEREFORE, ONLY GENUINE RISK FUNDS SHOULD BE USED. FUTURES AND OPTIONS MAY NOT BE SUITABLE INVESTMENTS FOR ALL INDIVIDUALS, AND INDIVIDUALS SHOULD CAREFULLY CONSIDER THEIR FINANCIAL CONDITION IN DECIDING WHETHER TO TRADE. OPTION TRADERS SHOULD BE AWARE THAT THE EXERCISE OF A LONG OPTION WOULD RESULT IN A FUTURES POSITION.

HYPOTHETICAL PERFORMANCE RESULTS HAVE MANY INHERENT LIMITATIONS, SOME OF WHICH ARE DESCRIBED BELOW.

NO REPRESENTATION IS BEING MADE THAT ANY ACCOUNT WILL, OR IS LIKELY TO, ACHIEVE PROFITS OR LOSSES SIMILAR TO THOSE SHOWN. IN FACT, THERE ARE FREQUENTLY SHARP DIFFERENCES BETWEEN HYPOTHETICAL PERFORMANCE RESULTS AND THE ACTUAL RESULTS SUBSEQUENTLY ACHIEVED BY ANY PARTICULAR TRADING PROGRAM.

ONE OF THE LIMITATIONS OF HYPOTHETICAL PERFORMANCE RESULTS IS THAT THEY ARE GENERALLY PREPARED WITH THE BENEFIT OF HINDSIGHT. IN ADDITION, HYPOTHETICAL TRADING DOES NOT INVOLVE FINANCIAL RISK, AND NO HYPOTHETICAL TRADING RECORD CAN COMPLETELY ACCOUNT FOR THE IMPACT OF FINANCIAL RISK IN ACTUAL TRADING. FOR EXAMPLE, THE ABILITY TO WITHSTAND LOSSES OR TO ADHERE TO A PARTICULAR TRADING PROGRAM, IN SPITE OF TRADING LOSSES, ARE MATERIAL POINTS WHICH CAN ALSO ADVERSELY AFFECT ACTUAL TRADING RESULTS. THERE ARE NUMEROUS OTHER FACTORS RELATED TO THE MARKETS, IN GENERAL, OR TO THE IMPLEMENTATION OF ANY SPECIFIC TRADING PROGRAM WHICH CANNOT BE FULLY ACCOUNTED FOR IN THE PREPARATION OF HYPOTHETICAL PERFORMANCE RESULTS AND ALL OF WHICH CAN ADVERSELY AFFECT ACTUAL TRADING RESULTS.