Hog Futures Outlook Appears Optimistic

Signs of increasing demand for US pork supplies have given hog futures a big boost today.  Hog futures have been choppy these past two months, and now pork prices are testing recent resistance levels.

Yesterday, USDA data reflected pork prices rising almost 1% to 90.7 cents per pound – the highest since last summer.  So far this year, pork prices are up a reported 10% as meatpackers show an increase of hogs entering slaughter by 1% than this time last year.
            
Tighter pork supplies are expected to continue through May and into June, lending support to hog futures.  Last year’s drought caused breeding problems resulting in fewer hogs available, while demand remains strong,” said Barb Levy, chief director for Futures & Options Xecution’s futures division in Chicago, regarding the current hog futures situation.

The technical trend for hog futures is up, but has been choppy over the last two months.  In order for me to enter long hog futures, I’m going to need a pull-back in price, or a lower-risk entry.  Patience is key.

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