which I'm sure you don't need a reminder of how quickly the hog market can put an end to a trend before the fundamental facts show up to justify the end to a trend. You are trading July, which the marketing numbers probably won't change that much barring a surprise hole showing up. So July is probably stuck in the 74.00-76.00 range. August on the other hand, has a 2-3 dollar discount to July based on an over hyped expansion story based on speculation, that is the logical reasoning for the increased market numbers. Maybe the report will prove rampant expansion true or maybe it will just give us neutral as expected numbers to work with, which is already dialed into the pricing structure.

I would assume there is a large following of short positions and if the report gives a surprise friendly set of numbers, there will be some panic buttons hit. Then there is the possibility it is mostly a demand issue, which can also have a quick and unexpected reversal. The $10 addiction has been fulfilled for July. The Aug contract which is always the benefactor for these beat down markets into early July is a $1 shy of the $5 extension but still a $15 qualifier. It is due for at least a $5 profit taking bounce range to set up another leg lower, if the rampant expansion is confirmed. If the hog market problems are mostly due to demand issues, pork has never been this cheap in July the last 5 years. You have to go back to 2009 the last 9 year cycle low to find hog prices below 77.00 for the July contract in late June. The percentages don't favor another leg lower until Oct but odds don't mean a lot with what we have seen the last 12-18 months. I would have been broke a long time ago trading the long shots, so that is something I can't bring myself to do.

The Aug contract is trying to set up the launching pad to send it back up to retest resistance at 76.00. Maybe a $5 pop is all it has to give us but if it finds a reason to break through 77.00 it will turn the $5 move into a $10 addiction fix at 81.00. It has all of the needed ingredients in place. The driving force behind such a move--------a full fuel tank of short positions.