Lean Hogs Analysis: Rising China pork imports bullish for Lean Hogs

October 17, 2019

By IFCMarkets

Rising China pork imports bullish for LHOG

Higher China pork imports are bullish for pork market. Will the LHOG continue gaining?

China’s pork imports in September surged 76% from a year earlier after deadly African swine fever reduced the world’s top pig herd by almost 40%, according to official data. Pork imports for the first nine months of the year were 1.33 million tonnes, up 43.6% from the same period a year earlier, according to the General Administration of Customs. China is the top pork consumer in the world with about 55 million tons of pork consumption last year. At the same time China has indicated readiness to increase purchases of American agricultural products by $40 to $50 billion annually, which will also include pork. Lower pig supply and higher import demand is bullish for LHOG.

LHOG tests MA(200) 10/17/2019 Technical Analysis IFC Markets


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On the daily timeframe the LHOG: D1 is retracing up toward the 200-day moving average MA(200).

  • The Parabolic indicator gives a buy signal.
  • The Donchian channel indicates no trend yet: it is flat.
  • The MACD indicator gives a bullish signal: it is above the signal line and the gap is widening.
  • The RSI oscillator is falling but has not reached the oversold zone.

We believe the bullish momentum will continue after the price breaches above the upper of boundary Donchian channel at 72.61. This level can be used as an entry point for placing a pending order to buy. The stop loss can be placed below the lower Donchian boundary at 62.97. After placing the order, the stop loss is to be moved every day to the next fractal low, following Parabolic signals. Thus, we are changing the probable profit/loss ratio to the breakeven point. If the price meets the stop loss level (62.97) without reaching the order (72.61), we recommend cancelling the order: the market has undergone internal changes which were not taken into account.

Technical Analysis Summary

Order Buy
Buy stop Above 72.61
Stop loss Below 62.97

Market Analysis provided by IFCMarkets