1/27/16 was up +$0.94 and the model projects that the CME Lean Hog Index component on yesterday's kill will jump between +0.65 and +0.95. The up-trend is still in place and it should last for at least two more days. Packers were really throwing money at hogs yesterday and they were only able to purchase 78.3% of the moving average daily purchase. That comes on top of a weak purchase of 72.1% of the moving average daily purchases the day before. For some reason producers were just not booking hogs the past two days.

With the 6-day moving average carcass weight for the Index hogs in decline and running somewhat lighter than the rest of the hogs, the stage seems set-right for the Index to move higher. In looking at the projected cash settlement price for the GGGs, I feel there is not a lot of risk being long the GGGs so I am continuing to hold onto the pair I have had for a week or so. Sometime I scalp out of them but when the end of the day rolls around, I'm long again. Yesterday I messed up a little and only carried one over-night but I got the second long back on the first thing this morning and it is now well into the money for me.

Ka!! Ching!! Just off-loaded a long K/M spread at my profit target and made a quick trip to the bank. Trading the K/M spreads continues to be one of my favorites but it really takes patience. That on was entered on 12/24/15. I have some still working from 12/8/15.

Best wishes,

dhm