Pork Futures: Hogs, Bellies Mixed
US - Profit taking along with commercial sales pulled lean hogs off their earlier highs. Most contracts moved up in early trading on spill-over from sharp gains in the cattle complex, floor brokers and traders said. Higher wholesale pork prices Wednesday and technical support also aided the early gains.
6 April 2007
2 minute read
However, the gains stalled due to premiums held by futures to cash along with talk in the pit that some packers have pork left to sell for next week and speculation that the plants may have to take lower prices to move the product. A floor broker said some early buyers turned sellers after the initial run-up, and commercial selling occurred that contributed to the decline.
"We also ran up against chart resistance in some months," a trader said.
An off-floor trader said while the longer-term outlook for the cash hog market is higher, there are only six trading days left before April's expiration, "so the floor is reluctant to widen the premium (futures to cash) that already exists and is quick to sell upticks unless cash is coming up along with it."
Traders also said positioning ahead of the holiday-extended weekend contributed to the mixed close.
In the early advance, April came within 10 points of matching the week's top hit Tuesday before it slid back to briefly penetrate support at the two previous days' lows and the 20-day moving average.
April hogs finished down 20 points at 65.17 cents. May closed 10 points lower at 75.22. Most-active June ended unchanged at 75.60.
Source: FX Street
"We also ran up against chart resistance in some months," a trader said.
An off-floor trader said while the longer-term outlook for the cash hog market is higher, there are only six trading days left before April's expiration, "so the floor is reluctant to widen the premium (futures to cash) that already exists and is quick to sell upticks unless cash is coming up along with it."
Traders also said positioning ahead of the holiday-extended weekend contributed to the mixed close.
In the early advance, April came within 10 points of matching the week's top hit Tuesday before it slid back to briefly penetrate support at the two previous days' lows and the 20-day moving average.
April hogs finished down 20 points at 65.17 cents. May closed 10 points lower at 75.22. Most-active June ended unchanged at 75.60.
Source: FX Street
