Hogs
Price action: December lean hog futures fell $1.275 to $69.10, nearer the daily low.
Fundamental analysis: The lean hog futures market saw technical selling pressure resume today as the bears tightened their grip—after the bulls saw some glimmer of hope early this week. Cash hog market prices continue to trend down, further strengthening the lean hog futures bears’ case. The latest CME lean hog index is down $0.41 at $79.22. Thursday’s projected CME index price is down $0.31 at $78.91. The national direct five-day rolling average cash hog price quote for today is $75.67. The USDA’s noon pork report today showed cutout value was down $1.02 at $82.82, led by losses in bellies. Movement at midday was 155.28 loads.
Technical analysis: December lean hog futures see the technical posture as overall bearish and the bears gained fresh strength today. The next upside price objective for the hog bulls is to close December futures prices above solid chart resistance at $72.00. The next downside price objective for the bears is closing prices below solid technical support at the contract low of $67.95. First resistance is seen at today’s high of $70.125 and then at this week’s high of $71.20. First support is seen at $67.95 and then at $67.00.
What to do: Get current with feed coverage.
Hedgers: You currently have all risk in the cash market.
Feed needs: You are now hand to mouth for corn-for-feed and soymeal for feed needs. Be prepared to make purchases if value prices arise from fall harvest pressure.
Cattle
Price action: December live cattle fell $0.325 to $223.775, nearer the daily high. November feeder cattle lost $2.475 to $335.80, nearer the session low.
Fundamental analysis: The live and feeder cattle futures markets saw routine corrective price pullbacks today, following Tuesday’s solid gains. Supply and demand fundamentals are still overall bullish for cattle and beef markets. USDA today reported still no cash cattle trading yet this week. The agency Monday said the average cash cattle trading price last week came in at $219.80, down 87 cents from the week prior average of $220.67. The noon report today showed declines in boxed beef prices, with Choice grade down $3.28 at $375.65 and Select grade down $0.21 at $356.13. Movement at midday was 64 loads. The Choice-Select spread is presently plus $19.52.
Technical analysis: December live cattle and November feeders are seeing prices trending up on their daily charts. The next upside price objective for the live cattle bulls is to close December futures above resistance at the August high of $229.425. The next downside technical objective for the bears is closing prices below solid technical support at $214.625. First resistance is seen at the September high of $225.50 and then at $227.00. First support is seen at $220.00 and then at last week’s low of $218.75.
The next upside price objective for the feeder bulls is to close November futures prices above technical resistance at $345.00. The next downside price objective for the bears is to close prices below solid technical support at $320.00. First resistance is seen at this week’s high of $339.00 and then at $340.00. First support is seen at Tuesday’s low of $329.85 and then at this week’s low of $327.825.
What to do: You are now hand to mouth on all corn-for-feed and soymeal needs. Be prepared to make additional purchases if value levels present themselves.
Hedgers: Carry all production risk in the cash market for now.
Feed needs: You are now hand to mouth for corn-for-feed and soymeal for feed needs. Be prepared to make purchases if value prices arise from fall harvest pressure.