8/17/19 was down -0.16 and the model projects the component on Friday's kill will change between +0.15 and -0.16. The MMMs settled premium to the component by +7.58. The model calculates that the component will need to gain an average of +0.395 to close the "Gap". On average over the past six-days the component has moved up an average of 0.345 and this has been during a high demand period as we were moving toward the Memorial Day holiday. Demand often slacks-off the last week of May. On average over the past 12-years the Index has gained +1.62 from this date until the MMMs go to cash settlement. The most gained was in 2018 when it jumped 13.70 and in 2010 it dropped -9.49.

Packers purchased 87.7% of the daily moving average of total purchases by the time the afternoon report was released and 95.2% on index hogs. That is a bit low for a Friday/Sat.

It may be difficult for the MMMs to hold and close a +7.58 "Gap" so I am no longer bullish the MMMs.

Best wishes,

dhm