Grain markets were under a bit of pressure today. December corn led the way lower, settling at 480 3/4, down 6 cents on the day. November soybeans managed to fill the gap from Monday, by settling 5 ¾ lower at 1386 ¾. Fortunately, soybeans were able to stage a bit of a late-session come back trading 6 ¼ cents off of its intraday low. September wheat was the lone component of the grain complex to trade higher on the day, trading 7 cents higher to settle at 576 ¾
Both of the cattle contracts showed a bit of weakness today, with October Live cattle down a buck 42, settling at 180.050. October Feeder cattle was down a buck 52 settling at 255.225. October lean hogs really stole the show today – up 2.87 on the session, settling at 83.60
October Lean Hogs
- It’s been a wild ride in the October Lean Hog contract over the past 3 months.
- We’ve made a formidable comeback after bottoming out on May 25th.
- Today’s candle represents a Bullish Engulfing Pattern.
- What the heck is that? As you can see, today’s opening price was lower than yesterday’s close. The length of the candle’s body also surpassed yesterday’s high price – engulfing the previous day’s candle, to ultimately close higher than any of the previous day’s trading range.
- This indicates a potential trend reversal.
- Seasonally, that checks out.
- Looking at the seasonal chart here, we can see that the October Lean Hog contract has trended higher each of the 5, 10, and 15 year periods.
- Corn bulls are going to be happy to turn the page on the month of August.
- The contract tested 500 on 8 separate occasions in August, each time failing to close above it.
- There is good news for bulls:
- We’ve remained mostly range-bound. The month of August had only a 40 cent trading range, compared to a 91 cent trading range last month.Typically, price consolidation leads to breakouts
- Seasonally, the December corn contract bottoms out in Mid-september before ultimately turning higher. So there’s hope.