![]() ![]() Before this new contract, stocker cattle operations had to use either the fed (live) cattle or feeder cattle futures or options contacts to cross hedge their price risk. The Chicago Mercantile Exchange now offers a new contract on stocker cattle in addition to the live fed cattle and feeder cattle futures and options contracts. (Print Friendly PDF)Ĭow-calf operators, winter wheat grazers and other cattle operators have a new tool to manage the risk of price changes with stocker cattle. Catlett, Professor, Department of Agricultural Economics & Agricultural Business and Extension Economist College of Agriculture, Consumer and Environmental Sciences New Mexico State University. There is no guarantee that the advice we give will result in profitable trades.Using the Stocker Cattle Futures and Options Contracts to Manage Price Risks Trading advice reflects our good faith judgment at a specific time and is subject to change without notice. We do not guarantee that such information is accurate or complete and it should not be relied upon as such. Trading advice is based on information taken from trades and statistical services and other sources that Trilateral, Inc. Past performance, whether actual or indicated by simulated historical tests of strategies, is not indicative of future results. The risk of loss in trading futures and/or options is substantial and each investor and/or trader must consider whether this is a suitable investment. ![]() TO THE EXTENT THAT YOU HAVE RECEIVED THIS COMMUNICATION INDIRECTLY AND SOLICITATIONS ARE PROHIBITED IN YOUR JURISDICTION WITHOUT REGISTRATION, THE MARKET COMMENTARY IN THIS COMMUNICATION SHOULD NOT BE CONSIDERED A SOLICITATION. PERSONS IN POSSESSION OF THIS COMMUNICATION INDIRECTLY SHOULD INFORM THEMSELVES ABOUT AND OBSERVE ANY SUCH PROHIBITION OR RESTRICTIONS. By accepting this communication, you agree that you are an experienced user of the futures markets, capable of making independent trading decisions, and agree that you are not, and will not, rely solely on this communication in making trading decisions.ĭISTRIBUTION IN SOME JURISDICTIONS MAY BE PROHIBITED OR RESTRICTED BY LAW. This material is not a research report prepared by Trilateral’s Research Department. and is, or is in the nature of, a solicitation. This material has been prepared by a sales or trading employee or agent of Trilateral, Inc. That would add confidence that another wave up is on the horizon. What we would like to see is that the market pulls back in price and RSI retreats to the 40-50 level, but holds. This typically implies that the preceding downtrend is complete. Looking at the RSI-Stochastic chart, we can see that RSI has established itself well above the bear market resistance line of 60. This builds the case for interpretation #1. Typically, we should see another new high (after a pullback) that has weaker momentum. On the daily chart, the most recent price high was accompanied by the greatest momentum. Only then can we deduce the most probable path for prices.Ĭurrently, we put the greatest probability on the first interpretation for the following reasons: If that move occurs, additional price information will allow us to apply the rules and guidelines of Elliott Wave theory. There is double bearish divergence in momentum and price on the hourly chart. We can gain confidence in taking long risk off the table or perhaps staying inherently short (if you are a buyer) because they agree on short-term movement being lower, even though the 2 interpretations differ in the long-term. Other technical indicators can be used to better assign probability and/or configure your confidence level of the decision.ĭetermining the Optimal Elliott Wave Count As more price information becomes known, the possibilities will narrow and decisions (bets) can be made on the most probable. Similarly, when practicing Elliott Wave theory, you should have multiple wave counts in order from most probable to least probable. To be successful, you must see the multiple potential sequences that can occur and then systematically deduct what is possible to make the best move(s) as the game plays out. If you assume your opponent has only one path for his/her choices while playing chess, you will most certainly lose. Like the game of chess, financial markets have multiple potential outcomes. Apply these rules/guidelines and it becomes a game of deductive reasoning of what can happen and what cannot. It is a market descriptor and describes how prices behave with a defined set of rules and guidelines, 90 in total (45 rules and 45 guidelines). Elliott Wave theory is not a market indicator or predictor. ![]()
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