June Lean Hogs opened strong, gap opening higher and trading to the session high at 88.875, which is just above resistance at 88.175. It collapsed and traded down to the session low at 85.325. It spent the rest of the session consolidating before an end of day rally took price up to 87.95 and it settled nearby at 87.80. The market is volatile as it is focusing on China’s needs and taking price higher before profit taking comes in and resets price as it is way above the Lean Hog index, which as of March 14 stands at 55.40. The index has recovered since reaching its low on March 7th at 51.71. The index has to continue higher, in my opinion to justify such lofty futures prices. Resistance remains at 88.175 and then 90.425. Support is at 85.375 and then 83.975.
For those interested I hold a weekly grain (with Sean Lusk) and livestock webinar on Thursday, March 21st 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,
www.walshtrading.com
RISK DISCLOSURE: THERE IS A SUBSTANTIAL RISK OF LOSS IN FUTURES AND OPTIONS TRADING. THIS REPORT IS A SOLICITATION FOR ENTERING A DERIVATIVES TRANSACTION AND ALL TRANSACTIONS INCLUDE A SUBSTANTIAL RISK OF LOSS. THE USE OF A STOP-LOSS ORDER MAY NOT NECESSARILY LIMIT YOUR LOSS TO THE INTENDED AMOUNT. WHILE CURRENT EVENTS, MARKET ANNOUNCEMENTS AND SEASONAL FACTORS ARE TYPICALLY BUILT INTO FUTURES PRICES, A MOVEMENT IN THE CASH MARKET WOULD NOT NECESSARILY MOVE IN TANDEM WITH THE RELATED FUTURES AND OPTIONS CONTRACTS.