MURICO.com Forum

The final Purchase Index for - - -

7/20/15 was down -$0.46 and the model projects that the CME Lean Hog Index component on the 7-20-15 kill will drop between -0.15 and -0.45. The QQQs are not trading discount to the component by -4.92. Hogs now seem to be in a down trend with the Purchase Index down for the fifth consecutive day. The CME Index has only been down for three days but it looks like today will make it four.

Carcass weights are holding firm and seasonally a decline would be expected. Perhaps this is telling us that producers are well fixed for market-ready hogs. Yesterday packers only purchased 89.6% of the moving average daily purchases but with Index hogs they did quite a bit better than that. They made this purchase with somewhat lower bids. Producers may becoming willing sellers. I think if I were a producer, I would be shipping quite aggressively with the high fall kill coming on fast.

I took on two short QQQs this morning on a trend line reversal signal. Was able to quickly go to the bank with one and will play with the other looking for a point or so on it. If the QQQs head higher (which they probably as a favor to Dewey), I will sell more. I have taken profits on most of the long Q/V spreads. I don't want want to completely clear them from the deck because they might test 15.00 as they often do. I have plenty of open holds to take on more if we can get a nice dip.

Best wishes,

dhm