Shootin' the Bull about downside projections

“Shootin’ The Bull”

by Christopher B Swift

7/07/2026

Live Cattle:​

Via the weekly close only, continuation chart, the last low close of significance was made 11/21/25 at $214.45, with a trade low of $204.55, represented by the December '25 contract month.  If the rally from that low created the completing wave sequence for the top, $214.45 to $204.55 will be the first downside target.  The next level of support from there will be the '23 highs, just under $190.00.  If the top has been made, these are the downside projections to anticipate.  If the top is not in, basis will converge significantly, but still may not fully if cash continues to weaken.

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The significance of the decline of the continuation chart is partly due to the discount August held, but has declined further since the roll to August.  Back to the top would be $19.10.  Half of that would be $9.55.  The decline of the August contract has been $12.95 from the same high as June made the historical weekly high.  Half of that would be $6.47.  A $6.47 rally from today's low would put August to $243.52.  I recommend you consider what little room you have to work with, barring a new contract high, and get your plan laid out to avoid further price erosion.  

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The most recent trendline able to be drawn on the weekly close only has been broken, leading to the expectation of reaching the 2nd, intermediate up trendline.  The oscillator remains well above the zero line and is moving lower, suggesting several weeks of lower trading to get below. The Moore Research seasonality shows a top at the first of July and end.  I think it possible the end of June high will be the seasonal high, and if there is a second rally, would fall short of the June 22 high. ​​

​​​​​Feeder Cattle: ​

Barring timing of sales, via September, the bulk of what could have been achieved in marketing is below $365.00.  At $370.00, the opportunities were few, and at $375.00 only the computers are believed to have picked the top. So, here at near $358.00 September, you are only $7.00 from the majority of high price available. This is to point out that you haven't missed much of anything, yet. ​

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A problem is that some of these prices available are potentially not profitable, or wish they had more profit in them.  I believe the top is in and that a bear market has just started.  I believe you have a short time frame to market inventory into before prices drop to first, the June 4 low.  After such, if that support does not hold, a new contract low will be anticipated with next support at around the $260.00 level.  That would still be $16.00 above the 2014 high.   

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​​​​Corn:

There is only $.16&1/2 difference between July '27 and '28 corn prices.  Sharpen your pencil and see how spending on a little option premium, deep into the future, would look like on your balance sheets.  Corn may well go to under $4.00 and that would be a huge benefit with the option premium a burr under your saddle.  Corn may well test, or exceed the over $8.00 levels in the coming years, and ownership of those call options would be of huge benefit in feeding cattle with $5.00 corn instead of $8.00.  ​

With the President still swinging left and right, and weather always a factor, there is no telling what may come next in the pricing of commodity goods. 

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Energy:​

Crude was sharply higher, while the products were lower.  That is until this afternoon when diesel and gasoline erased the majority of their losses.  Diesel fuel continues to be in a bull market with current downside price action a correction of.  Unlike crude oil, diesel fuel prices remain elevated well above the pre-military action level.  If any reason were to spark a rally, farmers will want to have all of their fuel needs booked for harvest.  Keep farm tanks topped off.    

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Bonds:

​Bonds are soft again.  Inflation continues.  Equities are believed forming a wave 2 correction with expectations of a significant drop. A close of the September mini S&P under $7,338.75 would lead me to believe wave 2 is complete and wave 3 in progress. Downside target is to $6,435.00, the March '26 low.  At $50.00 times the index, the value of the contract is $377,450.00.  So, every contract you trade would be equivalent to hedging 37% of a million dollar portfolio.  

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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.