Pork Futures: Most Hogs Gain
CHICAGO - Chicago Mercantile Exchange reports that most lean hog contracts finished firm on short covering, December/February forward positioning and far-month speculative buying.
8 November 2007
2 minute read
Pork futures spiked on the open, spurred by short covering and December and February's oversold Relative Strength Index conditions. Also, December's discount to CME's hog index and front-months' slide to new contract lows Tuesday emboldened buyers.
By the same token, consistent cash hog price deterioration and massive hog kills spawned selling into rallies. Nevertheless, late-day covering by shorts righted December pork futures. Also, December/February forward-spreaders out paced December longs that headed into February.
Extended cash hog price weakness is anticipated for Thursday as packers prepare for a Saturday slaughter in the 200,000- to 220,000-head range.
Thanksgiving effects
Wholesale pork demand is surprising recent gains in the face of large slaughters and continues to impress market watchers. However, they believe the situation could change as grocer buyers book product hand to mouth heading into the Thanksgiving Day holiday.
Prospective longs may again take another stab at a market bottom on Thursday, guided by December and February's still significantly oversold chart indicators.
Pork bellies ended mostly lower on profit taking and spot-February technical support loss. However, light speculative hedging pumped up July. December hogs closed up 35 points at 51.47 cents a pound, and dipped to a 50.95-cent fresh contract low. February closed down 35 points at 59.00 cents Source: FXstreet.com
By the same token, consistent cash hog price deterioration and massive hog kills spawned selling into rallies. Nevertheless, late-day covering by shorts righted December pork futures. Also, December/February forward-spreaders out paced December longs that headed into February.
Extended cash hog price weakness is anticipated for Thursday as packers prepare for a Saturday slaughter in the 200,000- to 220,000-head range.
Thanksgiving effects
Wholesale pork demand is surprising recent gains in the face of large slaughters and continues to impress market watchers. However, they believe the situation could change as grocer buyers book product hand to mouth heading into the Thanksgiving Day holiday.
Prospective longs may again take another stab at a market bottom on Thursday, guided by December and February's still significantly oversold chart indicators.
Pork bellies ended mostly lower on profit taking and spot-February technical support loss. However, light speculative hedging pumped up July. December hogs closed up 35 points at 51.47 cents a pound, and dipped to a 50.95-cent fresh contract low. February closed down 35 points at 59.00 cents Source: FXstreet.com
