Here are some links for cash, futures and basis: http://www.ams.usda.gov/LSMNpubs/PDF_Daily/DCBS.pdf http://www.ams.usda.gov/LSMNpubs/PDF_Daily/DFSS.pdf http://www.extension.iastate.edu/agdm/livestock/pdf/b2-42.pdf http://www.lmic.info/ Basis is a function of contract month, market conditions and a host of other marketing and trading factors. For instance, if it is May 1st the futures contract I have to use expires on June 30. The basis will be wider (generally) because we have 60 days until expiration of futures. Cash trade on May 1 won't necessarily have a large impact on the futures.
question. Did DeMark correctly pick the top in late Jan and early Feb in the Live Cattle and Feeder Cattle spot months?
Looks like it(DeMark) accurately nailed the low in LC on 04/04 or 04/05 with both a sequential and a countdown complete.
It isn't so much about nailing it dead on but rather about indicating the highest probability moves. I did check the charts on LC and we had a daily sequential then a countdown but cattle keep moving higher for sometime only to fail big time in January. On the weekly charts it was much clearer and did "nail it." The weeklies also caught the spring low very nicely.
I was surprised by strength late in the session, to be really bearish I would have liked to see a close at or near the lows. ] Bias is still negative.
sold my LC DEC 88 put at 325. 65 pt profit. wish I would've known the Goldman roll mishap with the imbalance of August contracts to buy and sell and the imbalance of October sales . Anyway, the market spoke to me and though I think bias is still negative, I took the money. still have my october 114/112 put spread in feeders on. not to contaminate the forum, but here is a nice setup in the peso. Time to buy dollars versus MXN says demark setup.