June Lean Hogs rallied on Monday, making the low early in the session at 99.20, racing to the high at 101.85 and the drifting the remainder of the day to settle near the high at 101.675. The price action formed a Morningstar Candlestick formation which indicates a potential bullish recovery in Hogs. The cutouts have rebounded the past couple of days after working lower most of last week. This is incentivizing bullish traders as they feel demand for pork is coming back and could lead to higher cash prices going forward. The summer grilling season is coming and grocers are getting ready for that and along with strong exports could put the smile back on bullish traders. We’ll see!… The rally in the June contract stopped just shy of resistance at 101.975 so this needs to be conquered to jettison price higher, in my opinion. A breakout above here could put futures on course to challenge the March 18th high at 103.475 when June took over as the lead contract. Resistance then comes in at 104.35. A failure from settlement could see price pull back to the middle of Monday’s trading range around 100.525. This fits with the Morning Star candlestick formation as price could retrace the break out bar. Support then comes in at 100.075. To negate the bullish pattern price would have to trade below the Friday low at 98.625.
The Pork Cutout Index ticked lower and is at 92.85 as of 03/22/2024.
The Lean Hog Index ticked higher and is at 83.59 as of 03/21/2024.
Estimated Slaughter for Monday is 484,000, which is above last week’s 481,000 and last year’s 483,729.
Cold Storage: Total red meat supplies in freezers were down 4 percent from the previous month and down 13 percent from last year. Total pounds of beef in freezers were down 6 percent from the previous month and down 12 percent from last year. Frozen pork supplies were down 1 percent from the previous month and down 12 percent from last year. Stocks of pork bellies were up 2 percent from last month but down 10 percent from last year.
For those interested I hold a weekly livestock webinar on Tuesdays and my next webinar will be Tuesday, March 26, 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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