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Cattle Futures Price Pattern Warns Of Food Inflation

By Chris KimbleCommoditiesJul 29, 2021 03:52PM ET
www.investing.com/analysis/cattle-futures-price-pattern-warns-of-food-inflation-200594708
Cattle Futures Price Pattern Warns Of Food Inflation
By Chris Kimble   |  Jul 29, 2021 03:52PM ET
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Cattle Futures Weekly Chart.
Cattle Futures Weekly Chart.

As inflation concerns remain in the headlines, today we look at the potential of food inflation by looking at cattle futures prices (i.e. beef).

Earlier this week we analyzed hard commodities copper and silver, as they are inputs and indicators for industrial inflation.

Cattle futures prices have rallied sharply and have reached an inflection point of great concern for those worried about inflation.

Above is a “weekly” chart of cattle futures that tries to show what to watch when asking “Where’s the price of beef headed?”

Over the past five years, cattle futures have created lower highs (red arrows) while remaining in a wide-ranging down-trend, marked by (A). But cattle prices have surged over the last 18 months and, more recently, formed a bullish cup-and-handle pattern at (1).

It just so happens that this cup-and-handle pattern is also testing down-trend resistance (A). A breakout above resistance at (2) could be a signal that food inflation is ready to creep into consumers budgets.

We could pay a ton more for beef at the store if a breakout takes place at (2). Stay tuned.

Cattle Futures Price Pattern Warns Of Food Inflation
 

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Cattle Futures Price Pattern Warns Of Food Inflation

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Comments (4)
Mark Stallone
Mark Stallone Jul 29, 2021 11:52PM ET
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RELAX. It's all part of Building Back "Better".
Bob Smith
Bob Smith Jul 29, 2021 9:28PM ET
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warns?  bro.  it's here.
Patrick McGoolies
DOGE10cents Jul 29, 2021 7:27PM ET
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Inflation is everywhere and it is NOT transitory
Todd Brooks
Todd Brooks Jul 29, 2021 7:27PM ET
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"Transitory" Fed speak refers to pricing ROC not Nominal.
taylor jason
taylor jason Jul 29, 2021 6:30PM ET
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the slaughter houses are forecasting supply to be back in align with demand come the fall. I think we will see cattle prices peak around labor day
 
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