July Lean Hogs gap opened higher at the low of the day (94.45) and raced to the high at 95.825. Price pulled back and tested the low then rallied again to settle near the high at 95.375. The open saw price open above the 100-DMA now at 94.35 and then race to resistance at the declining 21-DMA (95.20) and the key level at 95.30. The rally took price above its recent trading range with settlement just above resistance so this will key the price action on Tuesday in my opinion. A failure from settlement could send price down to test support at the rising 100-DMA. Support then comes in at 93.50. If price can take out the high, it could approach resistance at 97.30. Slaughter levels dipped to start the week, keeping it in close proximity to last year, so, the hope is we are starting to see slaughter decline and put some upward pressure on cash prices. Traders have been expecting numbers to decline thinking hog supply seasonally will be lower, but so far, the slaughter levels have been strong along with heavier pigs keeping production at high levels. This seems to have put a lid on cutout and cash prices keeping them in a trading range after a strong start to the year. The big question coming up is “Are railers finished with their July 4th purchases?” If cutouts can’t move higher, we may see more failure in the futures markets. We’ll see!…
The Pork Cutout Index increased and is at 100.45 as of 06/14/2024.
The Lean Hog Index decreased and is at 91.44 as of 06/13/2024.
Estimated Slaughter for Monday is 459,000, which is below last week’s 463,000 and above last year’s 456,693.
For those interested I hold a weekly livestock webinar on Tuesdays and my next webinar will be Tuesday, June 18, 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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