Just when you think you have the pulse of the market figured out, it changes and does something else. It may seem odd, but throughout Monday's trade the cattle complex traded higher, even though Monday marked the first day of the union strike at the JBS meatpacking plant in Greeley, Colorado.

It's imperative that we remind ourselves that the futures complex is an anticipatory market, and it's supposed to account for events such as this when the information is shared. Given the steep fall the futures complex has endured during the last two weeks, I think it's safe to say that plenty of downward pressure has been felt. Now, that's not to say that the market won't face continued pressure in the days ahead, as this does inevitably add another level of volatility and chaos to the market. But as the old saying goes, sell the rumor and buy the fact, which seems to be a perfect description of what played out throughout the cattle complex on Monday.

The other thing that could be adding support to the cattle complex is that last week was a sizeable win for packers, as they not only got cattle bought cheaper in the cash market, but boxed beef prices scaled higher, too. Last week, Northern dressed cattle were marked at mostly $372, which is $8 lower than the previous week's weighted average. Southern live cattle traded at mostly $235 to $236, which is $4 lower in Texas compared to the previous week and $5 lower in Kansas compared to the prior week. Throughout last week's trade, choice cuts averaged $395.54 (up $9.12 from the previous week) and select cuts averaged $388.40 (up $9.06 from the previous week). Combine these two factors and you can see how this considerably improves the packers' position and helps them regain more leverage in the marketplace.

So, while many expected today to be another leg down in the cattle complex, the market seems to have regained some footing. Now, the real challenge the market will face is how it's going to hold up over the test of time. Although the complex was able to close higher Monday afternoon, the market remains in a vulnerable technical state, as both the live cattle and feeder cattle contracts are trading near their 100-day moving averages.

Last but certainly not least, join me in praying for our friends and fellow ranchers in Nebraska as they have endured devastating losses from wildfires during the last week. May the wind stop, the moisture come and the land begin to heal.

For more on the Nebraska fires, see "NE Wildfires Rage Across 740K Acres," http://dtnpf.com/…

ShayLe Stewart can be reached at ShayLe.Stewart@dtn.com

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