Taking Profits in Lean Hogs

June Lean Hog prices dropped as low as 115.925 today before bouncing back up to ~117 at the time of this post.  We were short Lean Hogs with a 1200 strike price Put option we bought for $1040 (see our previous post: Shorting Lean Hog Futures with a Put Option).  Today we sold this option for $2400 and exited the market, since our target was the 50% Retracement Level of 115.50 and prices almost touched that level today.

We profited $1360 in 6 days with this trade – a 131% ROI!

Shorting Lean Hog Futures with a Put Option

We have been watching Lean Hog Futures (see our previous post: Lean Hog Futures Form 1-2-3 Top Formation?) and today, prices dipped below the #2 point of 123.00, going as low as 121.90 (June contract) before bouncing back up to currently ~124.00.

Since we’ve been planning to short this market when the above event occurred, we bought a June Lean Hogs Put option with a strike price of 1200 (2 strike prices out of the money) for $1040.00.  This option expires on June 17th, 2014.  Our target is the 50% Retracement Level of 115.50 on the Daily chart (see previous post).

Lean Hog Futures Form 1-2-3 Top Formation?

As you can see in the Daily Lean Hogs chart below, Lean Hog Futures have been forming a beautiful 1-2-3 Top over the past couple weeks and now we are just waiting for prices to fall below the #2 point of 123.00 before we short this market.  Our target will be the 50% Retracement Level on the Daily chart of 115.5, which gives us plenty of profit potential.  Stay tuned!

Daily Lean Hogs


Record Highs in Lean Hogs Futures

Lean Hogs Futures prices have reached a record high today of 118.575 (at the time of this post).   Lean Hog Futures haven’t ever been this high.  See the Daily and Weekly Lean Hogs charts below.  What goes up must come down, so we will be monitoring this market over the next few days to see what transpires.

Daily Lean HogsWeekly Lean Hogs