June 4, 2009
CME hogs hammered lower in washout move
Chicago Mercantile Exchange August lean hog futures on Wednesday (June 3) morning again gapped lower on the daily bar chart and hit another fresh contract low of 61.15 cents a pound.
Serious near-term chart damage has been inflicted with the recent strong move down in prices.
However, the rapidity and severity of the selloff in lean hog futures does suggest a "washout" type of price move that will soon put in a market bottom. August lean hogs have shed over 6 cents a pound in the past four trading sessions.
The next downside price objective for the hog market bears is to produce a close below strong technical support at the 60.00-cent level. For the beleaguered bulls to begin to regain some upside technical strength and to suggest that a market low has occurred, it would take a close in August lean hog futures above solid technical resistance at 65.00 cents.
