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Re: Thanks for sharing Dennis' thoughts, Dewey. M

What to Expect?
Four pieces of advice. First, forget about overbought indicators. This market will be overbought until the top is made. Second, don’t go short this market. Third, take measured and partial profits on the way up but stay net long calls because you’ll never be able to get back in. And forth, this market is good as long as the U.S. hog herd remains disease free. This means participate mostly in calls because being long futures if/when this event strikes won’t be pleasant. Producers need to secure puts underneath the market to establish a price floor and leave the topside open.

Investment banking money is pouring into April 2020 calls for the third consecutive day. Even traders with millions of dollars in capital are not willing to be long futures. Today we heard a large hedger, sadly, was forced out of the market as their line of credit to meet margins calls was fully extended. We’ve not recommended any short positions in futures since last Aug, when the ASF story first hit.

Above is part of what I received from Dennis this afternoon. I also read an article from Arlan Suderman with FC Stone that said China could have lost as much as 30% of their hog herd. The article went on to say that the entire production of Canada & the USA would not be enough to replace this loss! DH, I don't have any idea how high this market is going but I plan on staying with it for awhile.
Dewey

Messages In This Thread

The CME Lean Hog Index component on the kill for -
Thought's by Dennis
Thanks for sharing Dennis' thoughts, Dewey. My -
Re: Thanks for sharing Dennis' thoughts, Dewey. M