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Live Cattle & Feeder Cattle by TrendFollower

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Some of you may want to have a look at Live Cattle and Feeder Cattle for those interested in riding trends.

2078199785_FeederCattle_20180914_18_08.png.5bb821f71fb2b7f8da12148063af859f.png

 

2088700199_LiveCattle_20180914_18_09.png.f1986ad938baefafa1ed7413d3794c26.png

 

For those who want to manage their risk on the trade could decide to short one of them as a pair trade. If one attempts this type of trade then they need to go long on the one they feel is likely to go up by more points. For example at the time of writing Live Cattle is up 300 points and Feeder Cattle is up 430 points. So one could go long Feeder Cattle and Short Live Cattle. For the aggressive trader they may decide to go long both to maximise any returns / profits. Some of you may just go long on one of them. There are several ways you could play this trade. 

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I mentioned back in September 2018 about going long on both Live Cattle and Feeder Cattle.

Here is today's chart on Live Cattle.

1144116939_LiveCattle_20181227_11_00.thumb.png.9722fddb790575c9b1c10b66d9aeae4f.png

Here is the chart for Feeder Cattle.

676102415_FeederCattle_20181227_11_17.thumb.png.18da44e280477dfa47c0324c257d9a11.png

 

Looking at the charts the more effective trade would be to go 'Long Live Cattle' and 'Short Feeder Cattle' or just simply 'Long Live Cattle' only. 

Live Cattle may not be one of the 'sexy' Commodities to trade or the one reported in the media or the news channels like Bloomberg and CNBC which is why it is the more effective trade as it is away from most of the 'market noise' out there. 

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Here is the latest charts for Live Cattle:

213349626_LiveCattle_20190108_21_40.thumb.png.76d03a269188d64b6e9e39e1b58630a7.png

As you see the price action is positive and going upwards. 

Here is the latest chart for Feeder Cattle:

1440148553_FeederCattle_20190108_21_41.thumb.png.0a4de546ee3407ce1bd90bddf3d3a9b2.png

As you can see it has gone down in price since I posted the last chart. Therefore the price action is going downwards. 

One of the benefits of trading the so called 'lesser known' or should I state 'less popular' commodities is that you can really focus on the price action which is normally based on strong fundamentals and a strong 'narrative' which does not move at the whim of media articles or so called experts on the famous investment channels.

Food for thought!

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For those on the IG Community interested in this trade and are 'long' stay in the trade and do not sell too early. Your stop loss should only execute your profitable exit once the trend has changed. 

Now speaking of trend changes and it will occur then one must be ready to short the very asset they have just profited from on a long trade. This helps to maximise profits from an asset whether that asset is trending upwards or downwards.

If you look at Commodities such as Orange Juice, Lumber, etc. then this was evident. The trend downwards ends up being sharp and quick. I am expecting the same of Live Cattle. However there is no guarantee and it is certainly not a given. My personal opinion is that it is very likely. 'Assumption Testing' now required. 

So there is likely be a shorting opportunity for Live Cattle so be ready but keep long for now for those with open trades.

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I would not suggest going 'short' just yet but be ready for any trend reversal as this will be a nice shorting opportunity when it arrives and it will as profits are taken, stop losses triggered and new shorts opened. This will lead to a sharp drop amplifying the move downwards as so often seen in commodities. 

The commodities market has always had a reputation to entertain the speculators!

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Has the upward trend weakened? Is there about to be a quick and sharp downward move due to some major selling?

The chart below is at an interesting juncture:

1729328067_LiveCattle_20190201_13_22.thumb.png.15d920ff1ce332d43c9b7674cc6b139e.png

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Traders who adopt trend following principles will love to see strong trends as you can see in Live Cattle.

Trading with the trend increases your probability of success in the trade. The odds tilt in your favour. It does not guarantee a profitable trade but merely increases your chances. Trading is difficult at the best of times. The markets are ruthless. Trend following may not be the most profitable strategy but it is a strategy that can certainly decrease some of the risk associated with trading by never trading against the trend. 

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2 hours ago, TrendFollower said:

The question here is whether Live Cattle will try and surpass its 2017 high and then 2016 high?

I hope so but will be watching carefully.

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Remember if the trend reverses then use indicators such moving averages (trying to keep this very simple for you) to ensure your stop loss is set to execute an exit should the trend reverse.

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Live Cattle is at an interesting juncture. Traditionally one would expect to short now and follow the historical pattern that has been witnessed over time in this asset. Let us see if there is a trend reversal confirmation and this begins to drop which makes it a potential shorting opportunity or if it continues upwards after this brief pause.

17804489_LiveCattle_20190308_05_30.png.bea5698bf71772050e828300a76adca4.png

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$13000 is a key level for Live Cattle. If it does not make a new high then there could be a potential shorting opportunity should the price action present any confirmation signals of a trend reversal. 

853483442_LiveCattle_20190321_18_40.png.038d6e2db6f766d79af6abcfad25797b.png

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Live Cattle has gone below its 20 DMA. It is approaching a possible breach downwards of its 50 DMA.

There is a potentially rewarding shorting opportunity presenting itself. Of course there is the risk of this continuing upwards so one must be mindful of this just being a healthy correction. 

From my own personal experience, Commodities, attract a lot of speculative capital which drive up prices and amplify trends upwards. Once this is exhausted then the downward move is both quick and sharp. These can be very profitable opportunities so anyone interested may want to follow the price action of Live Cattle. 

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If you look at my three previous posts in March 2019 then you will see that I called this 'Short' trade based on my experience in trading Commodities both 'Long' and 'Short' over the years. Of course there are times when I am wrong and the market can go against any of my 'Trade Assumptions' but that is fine.

I am going to include the chart to show what a fantastic trading opportunity on the short side this is and well done for those who are trading this on the 'short' side. 

1161555123_LiveCattle_20190513_19_01.png.4c1a35a51448495f834fa7ce54047020.png

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Since my last post, Live Cattle, has continued its downtrend and its price is lower than it was when I last posted on this thread. 

I include the chart below to highlight this. 

205433950_LiveCattle_20190604_19_56.png.cc7db42c283865cb7839f5abe2266ea7.png

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It seems Live Cattle has shown us a potential breakout which seem pretty sharp. 

1233360726_LiveCattle_20191007_19_09.png.ffade491180014b777a606765717296f.png

The 'Parabolic SAR' is showing a very bullish sign for anyone interested in trading Live Cattle. 

1123360972_LiveCattle_20191007_19.09-2.png.0beeb8ba3893fef35946380fe162bd8c.png

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As you can see from my earlier post, I identified the strong breakout in Live Cattle as early as possible. This is 'key' to maximising profits and increasing your chances of success in a trade (when trading longer term than day trading). 

Live Cattle is up over 200 points today. 

Just look at the 20, 50 and 100 DMA curves slope upwards beautifully. This is what you want to see when an asset is trending strongly. The 200 DMA is not quite sloping upwards but it may well end up doing so if the current sharpness of the breakout continues. 

329140814_LiveCattle_20191101_17_52.png.146ab693531b571d565b0a99a3b9f355.png

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Live Cattle continues its remarkable upward trend. This is a strong push upwards. It has surpassed 12000 and it seems to be heading for 13000.

538294813_LiveCattle_20191112_20_53.thumb.png.ae7f4cb45f855a463feeb35886437658.png

Some of the strongest trends can be those which one leasts expects. It can be the 'non sexy' assets. Live Cattle may not be the commodity most trade but there is no denying that its price action is far more attractive to trade than most assets. 

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It seems Live Cattle prices are being supported by strong beef prices. Also it is being reported that Asia are also one one of the reasons why prices are going up. 

What we are seeing is a strong bullish trend upwards.

How many other assets during the same period have trended stronger than Live Cattle? Not many is the answer. 

 

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    • A demo account should work the same as live, otherwise it is misleading.
    • Hey,  The demo leveraged account will work in the same way however there are some issues on the demo account because we test on there to make sure the live account runs as smoothly as possible.  Unfortunately, as mentioned before, we don't offer demo for portfolios but you can find the performance information here. Say you wanted to see the data back from 31st July 2014, you can go back and see the performance since that time: https://www.ig.com/uk/investments/smart-portfolios/performance Thanks for your post. I will get this looked into so going forward this does not happen.   
    • @Trevbeats, Yes I do trade but I am an investor first and then a trader. I trade from the U.K. 
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