Weekly Purcell Agricultural Commodity Market Report Wayne D. Purcell Agricultural and Applied Economics Virginia Tech

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February lean hogs are trying to rally from their $48 level and the April contract shows attempts to move up from last week's close around $53. Technically, we are still in a downtrend in this market and will be until we see some bottoming action and a close above a downtrend line.

Watch that April lean hog contract and connect the early-January highs around $60 to the late-January highs just below $58. Look for this market to trade sideways and eventually give us a close above that downtrend line--that would be a buy signal.

Keep in mind that we have some support across the $53 level lows that we put in across the past few trading days, and I like to catch the market in a triangle in this fashion. I would not lift short hedges in this market until I get a buy signal above that downtrend line or until you see the $53 level of support tested again.

Generally, I am not nearly as bullish on this complex as I am on the cattle side and expect that we will continue to be mired in selling prices for cash hogs at or near the cost of production across the next few months before a summer rally.