Chart of the Day - December Live Cattle
The information and opinions expressed below are based on my analysis of price behavior and chart activity
Tuesday, September 9, 2025
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December Live Cattle (Daily)
December Live Cattle futures closed 6.400 lower today at 231.175. This was one of the more aggressive moves down that we’ve seen so far this year. In fact, a quick look over the last 6 months (duration of the chart above) tells me this was the largest day down for the December contract. Since setting the most recent contract high on August 27th, the market has struggled to find more upward momentum. You might notice the blue trendline on the chart, drawn off the late-June to mid-August lows, was broken by today’s trade. The 5- and 10-day moving averages (blue/red, 237.000/238.635, respectively) made a bearish crossover yesterday, indicating a bearish short-term trend change, which is the first signal since they turned bullish on July 1st. Basically, the market has been trending higher for 2+ months with out any meaningful correction or retracement. I think that’s what we’re seeing now. A correction. The 50-day average (green, 227.328 today) seems like a reasonable target, as that average held as support in June. However, I think it’s possible that the 100-day average (grey, 217.232 today) is a more likely target. You’ll notice that average was tested as support in April and held. Coincidentally, that average corresponds with the mid-June highs near 216.000. That level is denoted by the blue horizontal line. Stochastics (bottom sub-graph) have gone from overbought to oversold in just 4 trading sessions and are currently pointing lower. The previous instances of “oversold” only lasted between 3-5 sessions, so this market may not want to stay that way for long. Today’s close is also the lowest close since August 15th. I’m of the opinion that everyone that has established a long futures position since then is losing money, which may lead to further (and potentially faster) margin liquidation pressure. Trade Volume today was the highest over the life of the contract. High volume on a directional move like this often means more of the same in the days ahead.
Aggressive and well-margined traders may do well to consider short futures positions, with a goal of exiting the trade near the 216.000-217.000 levels. Traders with more patience may do well to consider waiting until support materializes and establishing long positions then.
Fundamentals are still bullish, in my opinion. We have less cattle, more people to feed and no sign of those conditions changing. We’re not importing more cattle, we’re importing more finished product (beef) to satisfy the demand. Until the US consumer balks at the Meat Counter, I think the uptrend in prices will resume.
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December Live Cattle (Weekly)
For the week so far, the December Live Cattle are down 6.275, adding to the -3.325 that they dropped last week. If you look at the chart above, you might notice that this market hasn’t strung together more that 2 weeks of bearish, or downward, trade since last summer (August of 2024) with 2 consecutive weeks being the most that this market has done since turning higher last September. We’ve obviously not closed for the week, it’s only Tuesday, but this would be week 2, if the market closes lower. You might see that the market has traded below the 5-week moving average (blue, 236.145 today) for the first time since July. To my eye, that average has acted as very strong support for the past 2 months and it isn’t very bullish now that we’re trading below it. The 10-week average (red, 229.593 today) has also acted as support over the past year. It’s true that prices have traded through that average a few times, but the trend has always re-affirmed itself. Stochastics (bottom sub-graph) are hooking lower, out of overbought territory, and are currently pointing lower on the chart. I’m not “bearish” in that I don’t think that “the high is in”. I think we’ll have higher prices and new contract highs down the road, as the fundamentals are still bullish (less cattle, more people to feed) but we have been somewhat overdue for a correction.
Seasonal Data can be found here, if you’re interested. Given the supply/demand equation here in the Cattle markets, I’m not certain that the seasonal patterns or tendencies matter very much right now. The data table does show that, on average, Live Cattle prices tend to decline in the month of September. Not by much, usually, as Barchart has pegged the average decline at only -0.112. There have been some large moves down in past years. 2021, 2016 and 2015 show the most recent declines, but according to Barchart’s data, most of the time (10 out of 15 years, not including 2025) they end the month higher.
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Every morning, at about 8 AM CST, I post a short video highlighting where I see opportunities in the futures markets. You can view my most recent video here
Jefferson Fosse Walsh Trading
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