Live Cattle can be a volatile instrument where risk and opportunity are both present. Last Friday we posted the possibility of a significant bottom in Live Cattle (LE) and on Friday and today we have seen a short squeeze. Today alone was a 2.6% move while Friday was just shy of 2%. This futures trading strategy is based on Hurst timing cycles as well as the Elliott Wave and Fibonacci work that we provide to our subscribers.
Could the bottom be in? We have a break of the small wedge to the upside which calls for a test of the trendline at $116. Convert the monthly pivot at 112.675Â to support and chances are good that we see the trendline break.
If the market has truly bottomed, the real work of clearing the $114.50 to $116.00 can get underway. The final week of July is a seasonally significant time period for cattle market bottoms.
The Daily chart shows the downtrend in live cattle since November of 2014. The smaller falling wedge has broken and the larger falling wedge is the next test. Break $116 and we open the test of $125.00 which would invite a full retest and possible set up and inverted head and shoulders.
For now, we are enjoying the moooove and looking for a possible beefier bullish trend in cattle!!