to packer submission-problems. I almost had my model ready to perform but it can't perform without data.

Over the weekend I looked at the historical behavior of the CME Lean Hog Index in the last month leading up to the GGGs going to cash settlement. Over the past eleven years the average index gain has been +3.61. But the variation from year to year is huge. In 2010 the Index gained 12.39 and in 2015 the index lost -14.74. If the high year and the low year are dropped, the average gain is +4.68.

I believe this tells us that there is a strong tendency for the Index to climb a little but this is the time of the year when supply/demand data can have a powerful impact. As I look at the way hogs have been beaten down this year, I don't think a drop of anything close to that maximum of -14.74 is in the works. On the other hand, I suppose a gain of +12.39 is possible but I wouldn't bet a nickel on it.

Traders have placed their bets and collectively they are saying the Index will jump +6.55 which is the "Gap" between the GGGs and the component. And I say, "Great!"

And I say that because the dynamics are right for a lot of volatility and it takes volatility to create trading opportunities. Historicals often mean very little in the but they are tending to say that the "Gap" may be a little wide so my preferred scalping entry is from the short so I will be looking for rallies that seem to be over-done.

I believe ITZ may find good fishing on the north end of the pond but he won't ignore the fact that there are fish on both ends.

I will try to keep my boat shuttling back and forth with a healthy load of G/J spreads. Today I want to take on a few longs at -5.775 and I have a few that are looking for a home at -5.10. At this point it looks like "The Market" is more interested in dumping a few onto me rather than taking some off my hands.

Best wishes,

dhm