February 5, 2024

What a SHORT…

The Cattle Complex has continued to rally since my January 9^th recommendation to reinstate short positions.…This has not changed my opinion in the slightest. I think this has become a better trade and continue to think that the Feeder Cattle buying frenzy that took place last fall will result in a ton of market ready steers hitting the market during the next 3-4 months…EVERYBODY was buying back in September, which blew the roof off on the upside in Feeders…and what we’ll soon be seeing is that same “EVERYBODY” SELLING in Feb, March and April…And with far more supply than the market needs, and all those market  ready LIVE ANIMALS HAVING TO BE SOLD, I am looking for prices to go straight back thru the  December lows and then a LOT more.

No, it doesn’t have to happen again just because it happened in 2015-2016…But DO observe that the chart above, going back 50 years, is jam packed FULL of nothing but sharp “V” reversals up and down…And the fact is, there really is no other market that even begins to look like this…Also to note, do understand that all those reversals back and forth from 1974 to 2008 may look small when compared to current prices, but all of those swings represented BIG percentage Dollars…the point being, to see Cattle drop 25% from here would really just be on the low side of NORMAL.

 Here are what I think are a couple of very smart options to own…

Just a big common sense trade I think…

Call me if you agree.

Thanks,

Bill

770-425-7241

866-578-1001

All option prices in this newsletter include all fees and commissions. All charts, unless otherwise noted, are by Aspen Graphics and CRB.

The author of this piece currently trades for his own account and has a financial interest in the following derivative products mentioned within: Live Cattle