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April Lean Hogs opened unchanged and rallied to the session high at 93.05. Price reversed course and fell to the low at 90.725. It consolidated the rest of the session and settled at 91.625. The early rally approached resistance at 93.50 and then broke down to support at the flattening 8-DMA now at 90.65 and then failed again to hold resistance at 92.375with the lower settlement. Hogs are now in consolidation mode with 92.375 and the 8-DMA as the pivots. There is also strong support just below the 8-DMA at 90.40. The cash markets continue to grind higher as the seasonals are in full display with slaughter falling and demand picking up for the Easter holiday. The February contract expires on Friday and it settled at 87.70 , which to me indicates the market continues to see cash moving higher. The index is below the February contract (see below) and should be higher tomorrow when the CME releases to current average. The cutout broke through 100 in the morning report and the afternoon report came in near 100, which will likely cause the Cutout index to jump and provide more support to the cash index. We’ll see!… A breakdown from settlement could see price re-test the Friday low and then possibly move towards support at the 8-DMA and the nearby 90.40 support level. Hogs have a gap from the February 5th low at 89.975 to the February 4th high at 89.90. Support then comes in at the rising 13-DMA now at 90.15. Price continued to fail at the 92.375 resistance level even though it made a new recent high on Monday. If price can overcome this level and settle above it, we could see a break out and a then successful challenge of resistance at 93.50 could send price up towards resistance at 95.30.
The Pork Cutout Index increased and is 94.87 as of 02/07/2025.
The Lean Hog Index increased and is at 85.39 as of 02/06/2025.
Estimated Slaughter for Monday is 491,000, which is above last week’s 485,000 and last year’s 481,478.
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Ben DiCostanzo
Senior Market Strategist
Walsh Trading, Inc.
Direct: 312.957.4163
888.391.7894
Fax: 312.256.0109
bdicostanzo@walshtrading.com
www.walshtrading.com
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