Hog Futures Technical Analysis | Hog Futures Trading: 2017-07-11 | IFCM
IFC Markets Online CFD Broker

Hog Futures Technical Analysis - Hog Futures Trading: 2017-07-11

Hog inventory in the US exceeded the 50-year maximum

The US Department of Agriculture (USDA) noted in its quarterly report that the hog inventory in the country has reached the maximum level in more than 50 years. Will the hog prices fall?

In the second quarter of 2017, the hog inventory has increased by 3% compared to the last year’s indicator for the same quarter and reached the maximum level since 1964 – 71.65 million. This is slightly more than the market participants expected. The number of fattening pigs in the United States rose by 2% and amounted to 6.069 heads. The market supply of hogs for sale on June 1 of the current year was 65.581 million heads against 63.302 for the same date in 2016. At the same time, its value reached the annual maximum. Theoretically, the increase in the supply of hog may provoke a price correction.

lhog

On the daily timeframe, LHog: D1 continues to be in a rising price channel, but its increase has slowed down. A downward correction towards the lower boundary of the channel is possible in case supply of meat exceeds demand.

  • The Parabolic indicator gives a bearish signal.
  • The Bollinger bands have narrowed, which indicates low volatility. They are titled downward.
  • The RSI indicator is below 50. It has formed a negative divergence.
  • The MACD indicator gives a bearish signal.

The bearish momentum may develop in case LHog falls below the last fractal low at 81. This level may serve as an entry point. The initial stop-loss may be placed above the last fractal high, the Parabolic signal, the upper Bollinger band and the annual maximum at 88. After opening the pending order, we shall move the stop to the next fractal high following the Bollinger and Parabolic signals. Thus, we are changing the potential profit/loss to the breakeven point. More risk-averse traders may switch to the 4-hour chart after the trade and place there a stop loss moving it in the direction of the trade. If the price meets the stop level at 88 without reaching the order at 81 we recommend cancelling the position: the market sustains internal changes that were not taken into account.

Technical Analysis Summary

PositionSell
Sell stopBelow 81
Stop lossAbove 88

IFCM Trading Academy - New era in Forex education
Pass Your Course:
  • Get Certificate
trading academy

The best trading conditions and high-level services for our clients

We are ready to assist you on any issue 24 hours a day.

Note:
This overview has an informative and tutorial character and is published for free. All the data, included in the overview, are received from public sources, recognized as more or less reliable. Moreover, there is no guarantee that the indicated information is full and precise. Overviews are not updated. The whole information in each overview, including opinion, indicators, charts and anything else, is provided only for familiarization purposes and is not financial advice or а recommendation. The whole text and its any part, as well as the charts cannot be considered as an offer to make a deal with any asset. IFC Markets and its employees under any circumstances are not liable for any action taken by someone else during or after reading the overview.

Close support
Call to Skype Call to WhatsApp Call to telegram Call Back Call to messenger