April Lean Hogs is now the lead contract as its volume has exceeded the volume of the February contract. It opened higher, made the session high at 78.55 and broke down to the low at 77.225. The market sat on its hands the rest of the session and settled at 77.625. The breakdown took price below support at 77.80. It was a listless day in the market as traders seem unsure of the cash market activity. The indices have been creeping higher, but is it due to the weather or is it sustainable? The wintry blast looks like it is over for now and slaughter levels leaped on Monday. Cutouts were higher for the one day which will keep the index firm. The breakdown below support however, implies that traders don’t believe the cash strength will last in my opinion. If futures continue lower, it could test support at 76.175. Support then comes in at 75.60. If futures can overcome resistance at 77.80, it could revisit the Monday high. Resistance is nearby at 78.80. Resistance then comes in at 79.80.
The Pork Cutout Index increased and is at 88.01 as of 01/19/2024.
The Lean Hog Index increased and is at 68.06 as of 01/18/2024.
Estimated Slaughter for Monday is 492,000, which is above last week’s 378,000 and below last year’s 493,684. Friday’s slaughter was revised lower to 477,000 and Saturday slaughter was also revised lower to 348,000. The estimated total for the week (so far) is 2,630,000, which is above last week’s 2,174,000 and last year’s 2,541,000.
For those interested I hold a weekly livestock webinar on Tuesdays and my next webinar will be Tuesday, January 23, 2024, at 3:00 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.
**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.
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