December Lean Hogs pulled back hard on Wednesday October 3, 2018, trading past support at 58.25 and the 21 DMA at 56.65 to the session low at 56.475. It settled at 57.15. It back in the middle of the 58.65 – 54.525 trading range. The euphoria over the USMC trade deal has waned and fears the trade war with China will continue into next year put pressure on Hogs. The African swine fever is still around however and with 21 cases reported in China (the country with the most hogs in the world); the potential for disease spread is high. The break down in price to the 21 DMA is important in my opinion, because if price fails from here a test of the 54.525 low is possible. If the 21 DMA holds, hogs may retest the 59.95 highs.
For those interested I hold a weekly grain (with Sean Lusk) and livestock webinar on Thursday, October 4th 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.