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Pork Futures: Hogs Cave To Chart Pressure, Fund Selling

by 5m Editor
15 March 2007, at 1:53am

CHICAGO - Chicago Mercantile Exchange hogs settled down sharply Wednesday on technical pressure, fund liquidation and sell stops. Further losses were attributed to April and June's bearish premiums to CME's hog index, uneasiness over near-term cash direction and Tuesday's pork cutout drop.

Chicago Board of Trade feedgrain's sag and spreading out of back-month hogs into forward contracts deepened far-month hog declines.

Spot April closed 122 points lower at 66.22 cents a pound. Actively-traded June closed 235 points lower at 75.65 cents.

Potential hog buyers stepped back on the outcry after being rattled by fund selling in outside markets and Tuesday's $1.33 pork cutout discount.

And although steady to $3 per hundredweight higher Missouri direct cash bids provided initial moral support, bulls were shaken by as much as $2 lower terminal quotes and uneven subsequent major direct hog returns.

Investors holding short positions were emboldened when April and June violated prime moving average support levels and after both contracts later filled significant March 8 chart gaps.

Source: FXSTREET.com

5m Editor