Shootin' the Bull about flurries of activity

“Shootin’ The Bull”

by Christopher B Swift

6/01/2026

Live Cattle:​

After a few short flurries of price action, traders settled down into a narrower trading range to finish the day.  Cattle feeders were profitable last week. The lower trading of feeder cattle in the late fall of last year lasted until November 28.  From that point forward, cattle feeders have been paying sharply higher prices, with last weeks projection, nearing $500.00 per head loss. Today's price action didn't help either from a futures stand point of higher feeder cattle futures than fats. Although basis narrowed slightly with the higher futures, the back month discounts are horrific towards attempting to manage adverse price risk.  As thought, the wider basis spreads will have producers assuming a lot more of the risk when placing cattle.  The Moore Research seasonal tendencies begin to move higher going into the end of July.  For the moment, I don't think the downside is complete.  When, or if, it is, the question becomes whether new contract highs are made, or just the creation of a time marking sideways to firmer move to satisfy the higher seasonal tendency. 

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From this point forward, I recommend viewing the hourly charts, and when overbought conditions form in technical indicators, use that rally to adjust positions you didn't like and add to those you did.  

​​​​Feeder Cattle: ​

​Basis was slammed narrower today with the index down and futures up. You can still market inventory, deep into the future, with an ability to narrow or close basis, and produce a higher minimum sale floor.  You just have to want to do it, and you have to be able to live with the consequences of you can't make any more above the short call strike price if using an options strategy that will allow for convergence of basis. Like above, were technical indicators to become overbought on the hourly charts, it will be an area of interest to add to the positions that are liked, and adjust those you don't.  I anticipate feeder cattle futures to consolidate for maybe another day and then move lower to complete this current down move.  

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Many have expressed that they can see the potential formation of a head & shoulders pattern.  However, some are opting to forego the current price level in hopes of the formation of a right side shoulder.  This may be a little more speculation for the moment as it is possible there is no right shoulder, or if made, isn't as high as it is now.  

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Next is the upcoming video sales.  With so much price movement, it is possible that previous decisions on derivatives has left considerable price expanse between where those floors are and what could be achieved today. A quick pencil to paper will tell you where you are positioned currently and how much of an increase in minimum sale floor can be achieved. If you need help in calculating this, gives a ring and we can help calculate that quickly.   

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​​​​Corn:

​Corn continues to melt. Wheat was no better and beans tried to recoup after selling off for most of the day.  The lower corn is believed an opportunity to own call options at strikes you no longer wish to pay for feed needs into December and July of '27.  

Beans were strong on the close, even closing down on the day.  Wheat continues to stump most in the hard sell off after recognition of such a poor crop this year.  Something to note is that even with a very strong energy market, only bean oil responded in a manner you would have thought.  Nonetheless, beans still look strong and maybe corn and wheat can beat out a bottom.  

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Energy:​

​Sharply higher today with no end of military actions in sight.  I believe today's higher trade is a reversal back to the upside.  Diesel fuel is expected to be the leader as last weeks reports showed stocks at extremely low levels.  Whether the energy market was the intended target or equities, but the Trump tweet this morning pushed energy down sharply and boosted the equities market.  In a rare event, a follow up tweet, a few minutes after, gave the equities the boost they needed to make the new highs again and took the starch out of the energy bulls for the moment.  Nonetheless, tweet or no tweet, the military actions continue and stocks of refined products are low.  Although the farming industry is wrapping up the final 25% of planting, one may want to consider keeping farm tanks topped off.  I'm hesitant to book it out into harvest, but I don't think it will be any cheaper by fall.   

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Bonds:

​Bonds continue to trade closer to their high end of the range than low.  The Trump tweets can do wonders to flailing markets and bonds are no different.  The desire to keep rates low and inflation high continues with very little foreseen to counter this.  Yes, crude may plummet upon an actual de-escalation of the military actions, but that hasn't happened yet. Recall though that were crude to plummet, it could produce significant unintended consequences.  Grains would lose a strong bullish component were energy to collapse, but I am unsure that lower fuel prices would turn the consumer into a roaring spending bull again.  I think the damage being done is only escalating issues from the Covid era.     ​

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​​​​​​​​​​ “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.