CORN
Corn had another one of those days like yesterday, lower then rally the later part of the day and close right around the previous day's close. Huh. It seems to me like corn is trying to mount a technical rebound but the soybeans are having a negative influence. I hate to be a broken record but we still need to close above a previous day's high to give me any confidence that we are going to make a retracement toward the contract high. The buy signal that showed up yesterday is still in effect but if the market doesn't close above $5.90 1/2 then I think we may run back down and try to test Wednesday's lows of $5.62 3/4. If one wants the market to make a move higher; the best close we could have tomorrow would be above $6.03 in the Dec '08 contract or at least above $6.00.
MEAL
Meal and soybeans were just downright ugly today. They really had a tough time moving higher (which isn't bad when you need to buy it obviously) and stayed under pressure most of the day. I hate to even say this because it isn't a textbook signal but one could make the argument that there was a buy signal (similar to what I saw in corn yesterday) at $364.00 in the Sep '08 meal today. IF this signal is good we should rally hard and fast just like corn should do if the signal there is good (it is hanging on by a thread). Same rule applies in the meal, still looking for a close above a previous day's high and we haven't done that since July 11th, 2008 much less even taken out a prior day high. Meal and soybeans rallied from their lows with about 5-10 minutes left of trade today so we will see if there is any follow through tonight/tomorrow.
HOGS
Hogs trade higher today posting solid gains in the front months in relationship to better cash prices and reaction to yesterday afternoon's cash and cutout values. The Oct '08 contract rallied toward the end of the day posting new highs in the process. The contract FINALLY closed above $74.00 (62% retracement) and if we can hold and close above it tomorrow too it would setup a technical objective of the old high of $77.42. Cash hogs remain firm for the moment but the Oct futures are on a seasonal up trend until the first week of August and then we trend lower into the middle of the month but they are only tendencies not predictions.
USDA ESTIMATED PORK CARCASS CUTOUTHurley & Associates believes positions are unique to each person’s risk bearing ability; marketing strategy; and crop conditions, therefore we give no blanket recommendations. The risk of loss in trading commodities can be substantial, therefore, carefully consider whether such trading is suitable for you in light of your financial condition. NFA Rules require us to advise you that past performance is not indicative of future results, and here is no guarantee that your trading experience will be similar to the past performance.
Based on FOB Omaha carlot pork prices and industry yields.
Calculations for a 200 lb Pork Carcass
53-54% lean, 0.65"-0.80" backfat at last rib
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Total Today's Primal Cutout Values
Date Loads Carcass Loin Butt Pic Rib Ham Belly
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07/24 54.8 85.47 100.46 90.65 68.67 97.60 88.06 87.60
Change : 0.15 -0.51 0.86 0.50 -0.51 -0.03 1.02
National Direct Hog Price Comparison
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: National : Iowa : Western : Eastern
: : Minnesota : Cornbelt : Cornbelt
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Base Price is the price from which no discounts are subtracted and
no premiums are added.
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BARROWS & GILTS : 1.11 hgr : 1.52 hgr : 1.36 hgr : .69 hgr
Negotiated : : : :
CARCASS BASIS : 70.75-82.50 : 73.00-82.50 : 72.00-82.50 : 70.75-80.92
185 lb Base Hog : wtd avg : wtd avg : wtd avg : wtd avg
Plant Delivered : 79.69 : 80.49 : 80.37 : 78.11
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