CHICAGO (Dow Jones)--U.S. live cattle futures were choppy Thursday as investors shifted positions after a recent rally and before the week's cash trade.

Cattle for October delivery were down 0.17 cent, or 0.2%, to $1.2082 a pound in trading at the Chicago Mercantile Exchange. The CME December contract rose 0.05 cent, or essentially flat, at $1.2095 a pound. September feeder cattle futures rose 0.2 cent, or 0.2%, to $1.369 a pound.

Investors have been sizing up a recent rally in cattle futures that has appeared to take place despite little change in underlying fundamentals. Wholesale beef prices have risen over the last week, but have nonetheless shown signs of weakness.

The U.S. Department of Agriculture on Wednesday reported choice beef prices were up 40 cents a hundred pounds at $184.57, while select was off 47 cents at $173.54. Beef sales on the day were reported at 311 total loads.

Exports of beef, meanwhile, continue to soar over last year, despite a recent downturn in shipments. The USDA reported that weekly exports were down nearly 9% over the previous week, for the week that ended Sept. 8. Year-to-date exports, meanwhile, stand at 551,209 metric tons, up 38.7% from the same period last year.

The recent rise in futures was fueled in part from buying among big investment funds. Traders reported a surge of buying Wednesday as big funds took fresh long positions, with some reacting to technical indicators.

The rising support for current prices raises expectations for this week's cash cattle trade, which isn't likely to take place until Friday. Analysts continue to debate whether rising futures are driving recent surges in cash prices, or vice versa. And yet, as cattle owners take animals to market, higher futures embolden them to ask higher prices, and even provides them incentive to wait for them.

Meat packers, meanwhile, have watched margins fall to very thin levels as prices for cattle have risen faster than wholesale beef prices. Continued thin profit margins could encourage packers to trim slaughter schedules until meat prices rise.

The latest HedgersEdge packer margin index was plus $2.60 a head, compared with $7.90 the previous day. This is an estimate of packer returns on cattle slaughtered and processed expressed in the form of an index.

Cash cattle bids have still not been established and trading will likely not develop until Friday, according to feedyard managers and analysts. Some bids may surface during the day Thursday at or near $1.16 a pound on a live basis.

Asking prices are now reported at mostly $1.21 a pound on a live basis and $1.92 a pound dressed. Higher futures prices are encouraging owners to push up their asking prices.

Cattle sold last week from $1.17 to $1.18 a pound on a live basis in Texas and Oklahoma. The range in Kansas was from $1.16 to $1.18 with the majority at $1.18. In Nebraska, sales last week were from $1.17 to mostly $1.18 a pound live and mainly $1.87 a pound dressed.