DTN Early Word Livestock Comments 03/27 06:18

DTN Early Word Livestock Comments 03/27 06:18 Trader Psychology Drives Market Cattle futures showed huge losses Tuesday as concern moved into the market and traders liquidated long positions. Cattle futures eliminated all gains since January. Hogs held up well, minimizing the spillover pressure from cattle. Traders are preparing for the upcoming report. Robin Schmahl DTN Contributing Analyst Cattle: Steady Futures: Mixed Live Equiv: $229.05 -$0.25* Hogs: Lower Futures: Mixed Lean Equiv: $101.28 -$0.41** *Based on formula estimating live cattle equivalent of gross packer revenue. (The Live Cattle Equiv. Index has been updated to depict recent changes in live cattle weights and grading percentages.) ** based on formula estimating lean hog equivalent of gross packer revenue. GENERAL COMMENTS: Cattle futures pancaked lower as long liquidation gripped the market and sell stops were hit. As futures declined, increased technical selling took place. Some of the pressure stemmed from the bearish numbers on the Cattle on Feed report, but some was fear of what the discovery of bird flu in dairy cattle could mean for the industry. The concern over bird flu was just a psychological reaction as it really could be construed as bullish to the market. If it becomes more of a widespread issue, it could be very bullish as affected cattle would lose weight, which would delay marketing and tighten beef supply further. It could also impact nursing calves. However, uncertainty plays a large role in the commodity markets. Cattle futures did bounce back from the lows, which could bring buyers back in if cash would trade higher again this week. Boxed beef prices were mixed with choice up $0.20 and select down $1.70. Cash cattle have yet to trade this week.