Look for hog futures to open moderately higher, supported by follow-through buying and oversold chart conditions. On the other hand, assume that cattle contracts will open on a mixed basis as traders position ahead of late-week cash business.
Cattle: Steady-$1 HR Futures: Mixed Live Equiv: $138.96 -0.16*
Hogs: Steady-$1 LR Futures: 50-100 HR Lean Equiv: $ 72.74 – .86**
* based on formula estimating live cattle equivalent of gross packer revenue
** based on formula estimating lean hog equivalent of gross packer revenue
After trading a few thousand cattle earlier in the week, packers and feedlots each went into shutdown mode, setting the stage for yet another do-or-die late-week cash market. Cash traders will no doubt quickly reclaim previous bids and asking prices (e.g., $108 bids; $112 to $114 asking prices) and then sit back for several hours, perhaps hoping the board will swing one way or the other, hoping something will make the other side blink. Live and feeder futures should open on a mixed basis, thanks to a light combination of pre-cash long liquidation and short-covering.