Technical Analysis #C-LCATTLE : 2019-12-12

Lower US beef exports bearish for LCATTLE

US beef exports are lower this year. Will the LCATTLE decline?

US beef exports are lower this year compared to the same periods a year ago, according to the USDA data. Beef exports in October declined 8% from last year’s high volume to 108017 tons. October beef exports declined 11% in value to $649.1 million. And for the January to October period beef exports declined 2.5%, equal to $6.75 billion decline in value from last year’s record shipments. For the first ten months of 2019, exports accounted for 14.1% of total beef production. Lower export is bearish for LCATTLE.

LCATTLE testing support  12/12/2019 Technical Analysis  IFC Markets chart

On the daily timeframe the LCATTLE: D1 is testing a support line above the 200-day moving average MA(200) which is level.

  • The Parabolic indicator gives a sell signal.
  • The Donchian channel indicates no trend: it is flat.
  • The MACD indicator gives a bearish signal: it is above the signal line and the gap is narrowing.
  • The RSI oscillator has formed a bearish divergence above the 50 level.

We believe the bearish momentum will continue after the price breaches below the lower boundary of Donchian channel at 123.67. This level can be used as an entry point for placing a pending order to sell. The stop loss can be placed above the upper Donchian boundary at 126.52. After placing the order, the stop loss is to be moved every day to the next fractal high, following Parabolic signals. Thus, we are changing the expected profit/loss ratio to the breakeven point. If the price meets the stop loss level (123.67) without reaching the order (126.52), we recommend cancelling the order: the market has undergone internal changes which were not taken into account.

Technical Analysis Summary

OrderSell
Sell stop Below 123.67
Stop loss Above 126.52

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