Hogs Can’t Hold Early Rally

Ben DiCostanzoGeneral Commentary

July Lean Hogs opened lower and rallied to the high at 94.575. Exports were good and Mexico was in for a large number. This helped sentiment early as many were worried with the Mexican currency sagging, they would back off of buying US pork. The cash index ticked higher and there was hope the cash market was going to turn around early in the session. That hope was squashed however as the morning cutouts came in lower, squashing whatever hope futures traders were looking for. If cutouts can’t rally, the cash hog market will likely stay in its range or go lower. Price broke down the rest of the session to the low at 92.475. Settlement was near the low at 92.775. The rally stalled just above the declining 13-DMA now at 94.375, with the decline stopping just above support at 92.375. Price continues to trade in the lower end of its recent trading range. A failure from 92.375 could send price down to test support at 91.80 which is the low of the trading range. Support then comes in at 90.40. If price can hold settlement, it could test resistance at 93.50. Resistance then comes in at the declining 13-DMA and then the  Thursday high. 

The Pork Cutout Index decreased and is at 100.99 as of 06/12/2024. 

The Lean Hog Index ticked higher and is at 91.38 as of 06/11/2024.

Estimated Slaughter for Thursday is 481,000, which is below last week’s 482,000 and above last year’s 467,788. The estimated total for the week (so far) is 1,426,000, which is below last week’s 1,446,000 and above last year’s 1,391,847.

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.

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Ben DiCostanzo

Senior Market Strategist

Walsh Trading, Inc.

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