December 4, 2024

 Blindly, Resolutely, and Confidently

SHORT FEEDER CATTLE

If I was leaving town today to spend the next six months in the woods and totally out of touch with the real world…and could only take one position before I left, to hold until I got back…this would be it. NO QUESTION.

It is not unusual for the best & biggest trades to sometimes wear you down before they finally do happen, and my ongoing recommendation to be Short Cattle definitely fits that description. But having been here before, if I have concluded that a trade has truly monster profit potential, like this one, just because it hasn’t happened (costing me money), and just because I have come to HATE it as each month goes by still being wrong, I know that what I DON’T do is give up…What I DON’T do is dwell on what I (and you) have lost and then allow myself to succumb to the “comfort” of being OUT of the trade…of no longer worrying EVERY DAY…and wondering “why it won’t get going,” and finally deciding to, “Be out and just watch it for a while.” If it IS a great, great trade…maybe one of the best ever…that is NOT what you do. Period. Period. Period. You spend the money again. And this is not an opinion that is just based in stubbornness. I THINK THE CATTLE MARKET IS A CLASSIC COMMODITY MARKET DISASTER JUST WAITING TO HAPPEN.

Because of the expanding price moves on the chart above, it is difficult to see just how big percentage-wise, and how straight down, Feeders have moved for the past 50 years…but that IS how they trade, often closing down 8-10 days in a row while doing so…while quite often getting hit for minimally 15-20% in 2-3 months time...all of which is evidenced by these recent 13 declines, seen here on the charts following, during just the past 20 years.

These charts are with “Closes Only,” which should make it clear that IF THERE WAS EVER A MARKET THAT CAN BE DESCRIBED AS HAVING A TENDENCY TO “GO STRAIGHT DOWN,” THIS IS IT.

And as I always remind you, and I will state it as a fact…in my mind anyway: NOBODY IN THE INDUSTRY…THAT IS, NO ANALYST AND NO CATTLEMAN…EVER SEES THIS COMING…But this IS what they do…over and over and over.

And do note the frequent down-stretches in which there are NO closing upticks.

Basic trading? USE this most recent 3 month rally to GET SHORT.

My immediate opinion remains that all of the hoohah last week about ONE DISEASED STEER A 1000 MILES FROM TEXAS was nothing but a classic top of the market “Bullish BS story,” and that every lower close right now…like today…could be the first nail in the cattle market coffin…And NO BIG SIZED MOVE ON THE IMMINENT DOWNSIDE WOULD SURPRISE ME RIGHT NOW…And oh, yeah, as for that out of the blue “ban on Mexican cattle imports?” Here’s betting that it just as suddenly gets re-thought and rescinded.

MORE BEARISH THAN EVER…I might be dead wrong, which I am obligated to remind you can mean losing whatever you invest, but I honestly think that just about any reasonable option you buy here will turn into a big winner…

Also just to note that there are options out in the April and May contracts that can also be used…

GET A DAMN PIECE OF THIS…ESPECIALLY YOU GUYS THAT HAD IT BEFORE…AND HAVE GIVEN UP.

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: Feeder Cattle