Live Cattle Futures—Cattle futures in the August contract have broken out to the upside as prices are now near a 5-week high as I am now recommending a bullish position from around the 99.80 level and if you took this trade continue to place the stop loss at 93.57 as the risk is around $2,500 per contract plus slippage and commission.
If you have been following any of my previous blogs you understand that I have been waiting for a breakout to occur as it happened in today’s trade coupled with the fact that a possible rounding bottom chart pattern may have developed as well so play this to the upside as I do believe the risk/reward is in your favor.
The United States released its unemployment number this morning as we added 4.8 million jobs as there is a lot of optimism going forward about the U.S economy and that is bullish cattle prices and many other commodity sectors as I think the worst could be over with as the next major level of resistance is around the 102 area which could be tested in next weeks trade.
The volatility certainly has expanded as we almost experienced a limit up trade today so make sure you risk only 2% of your account balance on any given trade and if the $2,500 is too much risk wait for some type of pull back before entering therefor lowering the monetary risk.
CHART STRUCTURE: SOLID
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