October Lean Hogs gap opened lower and traded down to the low of the day at 80.45. The low was right on the 80.45 support level and bulls came in and raced price higher. It traded up to the high of the day at 81.775, closing the gap and this was just above the key level at 81.70 which provided resistance, taking price on a journey downward, settling near the low at 80.70.Continued pressure on the cutouts is hindering Hogs as the cash index is attempting to bounce off its recent lows. The open was in my opinion a result of the cutout breaking lower on Wednesday and today was no different as cutouts were weak again on Thursday and this could lead to the Lean Hog Index once again turning lower if cutouts can’t bounce back. Slaughter levels are high and we are starting the seasonal where slaughter levels increase even more. This will keep production at high levels as hog weights are still well above last year. More slaughter could lead to continued pressure on cutouts which could see packers back off on cash prices. We get exports on Friday and the employment report which could influence Hogs. We’ll see!… If price breaks down from the low it could test support at 79.80 and then 78.80. If price holds settlement, we could test resistance at the declining 50-DMA, now at 81.125 and then 81.70. . Resistance then comes in at 83.325.
The Pork Cutout Index ticked lower and is at 96.59 as of 09/04/2024.
The Lean Hog Index ticked higher and is at 86.27 as of 09/03/2024.
Estimated Slaughter for Thursday is 485,000, which is even with last week and above last year’s 464,476. The estimated total for the week (so far) is 1,456,000, which is below last week’s 1,916,000 and above last year’s 1,419,319.
For those interested I hold a weekly livestock webinar on Tuesdays and my next webinar will be Tuesday, September 10, 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
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