October Lean Hogs opened lower and made the session low at 81.10. It grinded higher the rest of the session to the high at 82.30. It settled near the high at 82.175. The grinding action saw price approach the Tuesday high at 82.475 and it didn’t have enough energy to take out that high, but settlement was near the high and gives bulls hope that price can continue higher. Settlement was above the key level at 81.70 and the declining 50-DMA now at 81.625 which could further embolden the bullish traders. Friday is end of the month and with the rally Hogs have put forth could see some profit trading as traders may want to lighten their load. There is also another issue Hogs are facing as production is rising as slaughter and weights continue to rise, putting pressure on the cash markets. Cutouts and cash prices have been struggling and continued weakness could finally overcome the aggressive bulls. Producers on the other hand are hoping the continued strength in futures prices could reverse the negative price action in the cash markets and turn them higher. Pork demand has been in good stead, especially with exports holding their own in a time of high production. US demand has been okay and if that improves, packers and grocers may have to get more aggressive. If price breaks down from settlement, we could pullback and test support at 81.70 and then the declining 50-DMA. Support then comes in at 80.45 and then79.80. If price takes out the Tuesday high, we could test resistance at 83.325. Resistance then comes in at 85.325.
The Pork Cutout Index increased and is at 96.40 as of 08/28/2024.
The Lean Hog Index decreased and is at 87.45 as of 08/27/2024.
Estimated Slaughter for Thursday is 485,000, which is above last week’s 482,000 and last year’s 468,195. The estimated total for the week (so far) is 1,916,000, which is below last week’s 1,928,000 and above last year’s 1,899,196.
For those interested I hold a weekly livestock webinar on Tuesdays and my next webinar will be Tuesday, September 03, 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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