April Lean Hogs continued to rally on Monday, March 11, 2019. It broke out above the 200 DMA (61.31) and nearby resistance at 61.80 nearly going up limit for the second trading session in a row. It made its high at 63.50, just above the 63.325 resistance level before falling back and settling below resistance at 62.85. Continued excitement could see price test resistance At 64.80. Resistance then comes in at 66.55. A failure from 63.325 could see price consolidate within today’s range. China’s cash prices continued to surge as prices over there reaching its highest level in 14 months. This comes at a time when prices normally decline. What happens to price when demand goes up? Is China finally starting to feel the pain from the African swine fever? The disease has spread to 29 provinces and shows no sign of slowing down. Small producers are falling by the wayside and other producers are holding back supply as they expect prices to continue moving higher. Traders are anticipating Chines purchases of US pork to compensate for the loss of supply in China. Could the rising prices offset the tariffs on US beef? Nearby Asian counties are also dealing with the disease and Europe has disease issues of its own. Come to the US – China – we have your pork! Good eating!
For those interested I hold a weekly grain (with Sean Lusk) and livestock webinar on Thursday, March 14th 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,
www.walshtrading.com
RISK DISCLOSURE: THERE IS A SUBSTANTIAL RISK OF LOSS IN FUTURES AND OPTIONS TRADING. THIS REPORT IS A SOLICITATION FOR ENTERING A DERIVATIVES TRANSACTION AND ALL TRANSACTIONS INCLUDE A SUBSTANTIAL RISK OF LOSS. THE USE OF A STOP-LOSS ORDER MAY NOT NECESSARILY LIMIT YOUR LOSS TO THE INTENDED AMOUNT. WHILE CURRENT EVENTS, MARKET ANNOUNCEMENTS AND SEASONAL FACTORS ARE TYPICALLY BUILT INTO FUTURES PRICES, A MOVEMENT IN THE CASH MARKET WOULD NOT NECESSARILY MOVE IN TANDEM WITH THE RELATED FUTURES AND OPTIONS CONTRACTS.