Tallow Prices Consolidate as Energy Begins to Build

Tallow prices are consolidating and have remained steady as vegetable oil prices have whipsawed generating market trepidation.  Generally, a large rise following by consolidation is a continuation pattern, but tallow prices were unable to climb above the May highs when it visited resistance in November near 32.66.

Resistance is seen near the Bollinger band high which is 2-standard deviations above the 20-week moving average.  Support is seen near the 20-week moving average near 31 and then below that at the Bollinger band low which is 2-standard deviations below the 20-week moving average at 29. The Bollinger bands are contracting reflecting declining historical volatility.  As energy builds up, the likelihood of a large move begins to build.

Momentum is neutral as the MACD (moving average convergence divergence) index prints in the black, but the trajectory has declined steadily after hitting a high in December, and is nearly zero.

The daily MACD also reflects consolidation. After generating a sell signal in November, it has slowly declined and has a very flat trajectory.

The RSI (relative strength index) which is a momentum oscillator that measures overbought and oversold levels along with momentum.  The current flat line shows very little activity and is printing a reading of 65, which is in the middle of the neutral range and reflects consolidation.

For any questions or comments in regards to Tallow Prices Consolidate as Energy Begins to Build please contact David Becker at [email protected]

Please contact Ryan Standard at 563.223.9021 or [email protected] with any questions, comments or trading.

Broiler-fryer slaughter under federal inspection for 10-Feb-17 and 11-Feb-17 is estimated to be 32,775,000 head down 0.66 percent from a week ago and up 4.1 percent from a year ago.

(Last week 32,993,000, last year 31,486,000)

Weekly broiler-fryer slaughter under federal inspection for the week ending 11-Feb-17 is estimated to be 164,077,000 head up 1.03 percent from a week ago, and up 3.28 percent from a year ago. (Last week 162,401,000, last year 158,868,000)