9/16/15 was up +0.19 to 71.07. The strength of the VVVs this morning has exactly closed the "Gap"! That is consistent with the historical tendency that I referred to earlier this morning. The model really spotted the end of the downtrend that had been going on in the Index and was quite close on the projected change in the component today.

The six-day moving average carcass weight moved up to 210.23#. Perhaps the weather is cool enough and the corn fresh enough to cause hogs to gain quite rapidly. That weight is -2.12# yr/yr and +5.92# over 2013. Packer hogs gained nearly twice as much weight as the non-packer hogs. It appears that packers are liking the efficiency of processing heavier hogs to produce more pork. I have said before that there is no problem with a large hog that a sharp knife can't fix.

This morning after I reviewed the historical data showing a strong tendency for the Index to rally following the Labor Day slump, I decided it was time to buy VVVs. I only got one and it was well into the morning rally when I got it done. Now that the VVVs are locked limit, I'm glad I did get at least one.

I'm waiting for the V/Z spread to move up to 7.05 to sell the next one.

I just checked the price of the 73 calls and it is 1.375. This means that there is a block of traders who think the VVVs will bust through the 74 level. This may be the lift-off that ITZ has been looking for.

Best wishes,

dhm