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June 17, 2025
The Flameout Has Begun…
During the past YEAR,
this idea has cost me more money…and credibility…than any trade I have made
in my entire 45 years doing this…
BUT, I long ago taught myself,
that however wrong I might have been, when I walk back up to the table, I
absolutely have to be as rigidly objective in my analysis as I always try
to be, and then, more importantly than anything, DO whatever it is my
research, experience & instincts tell me to do. I cannot be fearful of
losing money. I cannot be thinking, “What if I am wrong again?” NO
MATTER HOW WRONG I HAVE BEEN…IF EVERY INSTINCT IN MY BRAIN AND BODY SAYS THE TIMING IS
FINALLY NOW…AND ESPECIALLY WHEN I JUDGE THE PROBABILITY TO BE SO HIGH AND
THE PROFITS POTENTIAL TO BE SO ENORMOUS…I DO THE TRADE.
FACT: For 50 years, both Live Cattle and Feeder Cattle
have ended bull markets with almost straight down “V” type reversals. They
DO literally reverse from one day to the next, often somewhat quietly, and
on ZERO news that infers, “Sell now.”
FACT: Every single person in the cattle business that I
have talked to recently has used the term “CRAZY” for what steers, calves,
culls and old bulls are bringing…and “know they can’t stay up here.”
FACT: But, with one exception ( a
hedger), every single one of those individuals won’t even THINK about
shorting them here.
FACT: There is never any logic or fundamental analysis
involved in the final stages of any bull market top. It’s all about
speculative money buying the market, irrespective of how unrealistic
(CRAZY) prices get, usually accompanied by some bullish “mantra” that
oh-so-perfectly seems to justify even higher values, when, in reality,
whatever that unanimously repeated catchphrase might be (this time it’s
“Smallest herd in 70 years!”)…it is nothing but the hallmark of a CLASSIC
FUTURES MARKET BUBBLE…and six months later, after the INEVITABLE price
collapse, it will have become just one more DISPROVEN example of, “This
market just won’t go down!”
If
you are looking for a top from which to initiate short positions, the first
thing you minimally need to see is one weekly lower close to indicate that
the bull move has potentially ended…which is what we had last week…on no
particular news whatsoever…And as can be seen below, that weakness has
DEFINITIVELY continued into this week. Per the 50 year
histories I have often presented here, when bull markets in Cattle do end,
much more often than not they DON’T hang around near the highs, and they DO
go relatively straight, straight down…With this in mind, one more time, I
STRONGLY RECOMMEND IMMEDIATELY GETTING SHORT FEEDER CATTLE AND/OR LIVE
CATTLE.
Nothing else I can say. Here are the charts…
The Long Term…and this IS in the stratosphere.
These two charts are of weekly closes only…
 
If you want to wonder if this IS finally it, go ahead
and just watch. But for my money, at over $3.00 Feeder Cattle and
$2.00 Live Cattle, I’ll be there NOW. As I keep saying, when they
go, they GO…And I
see today’s 7 cent lower close in Feeders ($3500 per futures contract) and
5 cents lower in Live Cattle ($2000) as JUST GETTING STARTED.
Plain and simple….YOU BUY THESE
PUTS NOW…AND IF EITHER CONTRACT MAKES NEW HIGHS, YOU GET OUT AND TAKE THE
LOSS. In other words, you don’t have to risk the entire option’s value.
And to put it mildly, soaring energy prices are NOT
going to be a positive for beef demand at the supermarkets.
One more time…The fact that I have been wrong has
NOTHING to do with what comes next here…
Just do it…
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.
FUTURES
TRADING IS NOT FOR EVERYONE. THE RISK OF LOSS IN TRADING CAN BE
SUBSTANTIAL. THEREFORE, CAREFULLY CONSIDER WHETHER SUCH TRADING IS SUITABLE
FOR YOU IN LIGHT OF YOUR FINANCIAL CONDITION. PAST PERFORMANCE IS NOT
INDICATIVE OF FUTURE RESULTS. THERE IS NO GUARANTEE YOUR TRADING EXPERIENCE
WILL BE SIMILAR TO PAST PERFORMANCE.
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, Live Cattle
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