Hogs Weaken
If you would like to receive more information on the commodity markets, please use the link to join our email list - Sign Up Now
For those interested I hold a weekly livestock webinar on Tuesdays and my next webinar will be Tuesday, December 10, 2024, at 3:15 pm. It is free for anyone who wants to sign up and the link for sign up is below. If you cannot attend live a recording will be sent to your email upon completion of the webinar.
February Lean Hogs opened lower and traded rallied to the session high at 87.875. The rally took price above resistance at 87.10 and the 200-DMA now at 87.375 but it couldn’t hold the rally and broke down to the low at 87.875. A strong morning cutout saw price bounce back and it re-tested the 200-DMA, falling just short of the resistance level and then failing and working its way towards the low. The low took price below support at the rising 13-DMA now at 86.625 and it settled near the low (and below the 13-DMA) at 86.50. The price action was concentrated in the middle to lower end of the 89.60 – 85.375 trading range that the Hogs have been trading in over the past 9 sessions. The high of the range is also the high for the life of the February 2025 contract and the high on the continuous chart on the recent rally from the September 30th low. The cash index continues to break down but the pork cutout index has stabilized creating some angst for futures traders in my opinion as they like to see both move in the same direction. With a large long position in the market, who is left to get long as we are near the high of the rally and are getting close to the end of the month and year. So, for at least the start of the week we get some selling pressure and maybe the beginnings of some liquidation. If the cash market continues lower, it could lead to liquidation and price could get pressured into the end of the year. We’ll see!... If price breaks down from settlement, it could re-test support at 85.325. Support then comes in at the rising 21-DMA now at 84.675 and then 83.325. If price can get above the rising 13-DMA, it could re-test resistance at the 200-DMA. Resistance then comes in at 88.325.
The Pork Cutout Index increased and is at 90.34 as of 12/06/2024.
The Lean Hog Index decreased and is at 83.73 as of 12/05/2024.
Estimated Slaughter for Monday is 489,000, which is even with last week and above last year’s 462,517.
**Call me for a free consultation for a marketing plan regarding your livestock needs.**
Ben DiCostanzo
Senior Market Strategist
Walsh Trading, Inc.
Direct: 312.957.4163
888.391.7894
Fax: 312.256.0109
Walsh Trading, Inc. is registered as a Guaranteed Introducing Broker with the Commodity Futures Trading Commission and an NFA Member.
Futures and options trading involves substantial risk and is not suitable for all investors. Therefore, individuals should carefully consider their financial condition in deciding whether to trade. Option traders should be aware that the exercise of a long option will result in a futures position. The valuation of futures and options may fluctuate, and as a result, clients may lose more than their original investment. The information contained on this site is the opinion of the writer or was obtained from sources cited within the commentary. The impact on market prices due to seasonal or market cycles and current news events may already be reflected in market prices. PAST PERFORMANCE IS NOT NECESSARILY INDICATIVE OF FUTURE RESULTS.
All information, communications, publications, and reports, including this specific material, used and distributed by Walsh Trading, Inc. (“WTI”) shall not be construed as a solicitation for entering into a derivatives transaction. WTI does not distribute research reports, employ research analysts, or maintain a research department as defined in CFTC Regulation 1.71.