Cash prices to rise seasonally and wholesale prices continue as well but in my opinion it is just moving a lot slower than expected. The latest quote for the CME index rose for last Friday 24 cents to $79.86. Pork cutouts slipped 8 cents to $88.72 after hitting a 2023 high on Monday at $88.80. Seasonally we are in a period now from March to early April where its typical for hogs to trade sideways to lower as supplies tend to increase during that time of the year. Consumer demand tends to turn up in late April due to grilling season from late spring to summer. With that being said I believe the summer month contracts are under priced right now and could still break last months high of 105.
Technically, the April contract seems to have some profit taking the past two sessions in my opinion after the Friday surge of over $2. Volume has decreased the last sessions along with open interest. I believe 90 is still the next upside target but would have to get through some pretty solid resistance levels at $85.70 for the first level and $87.45 for the second. Based on the fundamentals, it seems like it would be difficult for these resistance levels to be broken in my opinion but if cash continues to be higher, there could be a surge in futures up to the $90 price level.
APR Hogs
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