LIVESTOCK — Cattle futures sag on technical selling; USDA data awaited

By Julie Ingwersen CHICAGO, Sept 17 (Reuters) — Chicago Mercantile Exchange live cattle futures fell on Thursday for a third straight session on technical selling, softening packer margins and positioning a day ahead of a monthly government feedlot report. CME October live cattle futures settled down 2.800 cents at 215.650 cents per pound. Most-active December cattle ended down 3.950 cents at 216.250 cents a pound, dropping below chart support at the contract's 20-day moving average near 217 cents. CME October feeder cattle fell 5.275 cents to settle at 324.375 cents per pound. Packer margins were slipping. Beef packers were earning $64.60 per head of cattle as of Thursday, down from $90.20 a day earlier and $180.45 a week earlier, according to Denver-based livestock marketing advisory service HedgersEdge.com LLC. LIV/H Traders were adjusting positions ahead of Friday's monthly USDA Cattle on Feed report. Analysts surveyed on average expected the government to report the number of cattle in US feedlots as of September 1 at 11.268 million head, up 1.7% from a year earlier. But placements into feedlots and marketings during August were seen below year-ago levels. Meanwhile