Live Cattle/Lean Hog Spread: Entry Signal Triggered

Live Cattle/Lean Hog Spread

Today the February live cattle/lean hog spread closed at 75.35 (premium cattle). This put it back below both the 50-day Moving Average and the December 8th low, confirming the bearish trend change from last week. Today’s price break triggered a short sale signal.

February Live Cattle Lean Hog spread daily

February Live Cattle Lean Hog spread daily

The IMC blog made a hypothetical trade by selling one 40,000 lb. February live cattle contract at approximately 155.82 and simultaneously buying one 40,000 lb. February lean hog contract at approximately 80.47. This opens a short spread position at 75.35. Initially, we will liquidate the spread on a two-consecutive day close above 82.42.

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