8/9/16 kill was down -0.43 putting the component on yesterday's kill at 68.58. The QQQs are now discounted to the component by -1.53 and the "Gap" for the VVVs remains wide at -10.58. Traders may keep the VVVs down at this level as long as packers keep cutting their bids by a half-point or more a day but when the VVVs get to be front month, we may see a limit-up move as traders decide they want a smaller "Gap". I have noticed quite often these limit moves happen when there is a large "Gap" for the new front month.

The six-day moving average carcass weight eased to 207.91 and packer hogs were down a bit more than the non-packer hogs. It appears to me that packers are liquidating their market hogs. After the big drop we saw in the weight of packer hogs yesterday, I thought maybe the weight would firm a bit today but it didn't!!

The model projects that the cash settlement index for the QQQs will be 67.25 with a range of 66.75 to 67.75. It appears that traders have the QQQs priced just about right.

Have flipped quite a few spreads this morning. I suspect it it the Goldman Roll that has them stirred up. Still short the VVVs but not as short as I was but my wallet is a little fatter than it was.

Best wishes,

dhm