July lean hog futures (HEN25) present a buying opportunity on more price strength.
See on the daily bar chart for July lean hog futures that prices are trending higher and have just hit a nearly three-month high. See at the bottom of the chart that the moving average convergence divergence (MACD) indicator is also in a bullish mode as the blue MACD line is above the red trigger line and both are trending up.
Fundamentally, the U.S.-China trade war is starting to thaw and that’s friendly for lean hog futures as China has been a major importer of U.S. pork. Also, record-high cattle futures (LEM25) (GFQ25) prices are drawing more speculative buying interest in the hog futures market, as many traders reckon historically elevated beef prices at the meat counter will draw better substitution demand for less expensive pork cuts. Summertime grilling season is also close at hand, which will also mean better demand for pork cuts.
A price move in July lean hog futures above chart resistance at this week’s high of $103.675 would become a buying opportunity. The upside price objective would be $112.00 or above. Technical support, for which to place a protective sell stop just below, is located at $100.00.
IMPORTANT NOTE: I am not a futures broker and do not manage any trading accounts other than my own personal account. It is my goal to point out to you potential trading opportunities. However, it is up to you to: (1) decide when and if you want to initiate any trades and (2) determine the size of any trades you may initiate. Any trades I discuss are hypothetical in nature.
Here is what the Commodity Futures Trading Commission (CFTC) has said about futures trading (and I agree 100%):
On the date of publication, Jim Wyckoff did not have (either directly or indirectly) positions in any of the securities mentioned in this article. All information and data in this article is solely for informational purposes. For more information please view the Barchart Disclosure Policy here.Trading commodity futures and options is not for everyone. IT IS A VOLATILE, COMPLEX AND RISKY BUSINESS. Before you invest any money in futures or options contracts, you should consider your financial experience, goals and financial resources, and know how much you can afford to lose above and beyond your initial payment to a broker. You should understand commodity futures and options contracts and your obligations in entering into those contracts. You should understand your exposure to risk and other aspects of trading by thoroughly reviewing the risk disclosure documents your broker is required to give you.
