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May corn closed 1 1/4 cent higher on relatively heavy volume of 400,852 contracts. Open interest increased by 1,354 contracts. There was no change in the May-July bull spread, and it currently stands at 9 cents premium to May. Stand aside.
May soybeans closed 4 cents lower on volume of 255,675 contracts. Open interest declined by 2,079 contracts. April 11 marked the first time since March 20 that open interest declined. Stand aside.
May wheat closed 2 1/4 cents lower on relatively heavy volume of 146,705 contracts. Open interest declined on the slight advance by 7,963 contracts. I am writing about wheat because on April 11 wheat generated in intermediate term sell signal. Usually an intermediate term sell signal is a very strong indication to be short the market. However, in this case speculators should not be short, nor should speculators acquire long positions either. The reason for this is that wheat is being used as a substitute feed for corn, and my view is that wheat will trade parallel to the price of corn. Since I am friendly to the corn market, I believe the downside in wheat may be limited. As I write this on April 12, May wheat is 10 cents higher. Stand aside.
May sugar closed 8 points higher on fairly heavy volume of the 135,313 contracts. Open interest declined by 4,476 contracts. The trading range for the day was only 26 points, which is less than half of its 21 day average true range of 55 points. The market has not generated a sell signal as of yet, and at this point, speculators should stand aside.
May closed $1.70 higher on volume of 637,180 contracts. Open interest increased by an anemic 2,780 contracts. The market is on a short-term sell signal, which in this case means that speculators should not acquire long positions, nor should they implement short positions. Geopolitical tensions could flare at any moment and this would power the market significantly higher. The volume and open interest action continues to be lackluster. Stand aside.
May gasoline closed 4.59 cents higher on healthy volume of 200,757 contracts. Open interest increased by a minuscule 2,547 contracts. Stand aside.
May copper closed 1.05 cents lower on heavy volume of 106,615 contracts. Open interest increased on the move by 197 contracts. The market made a new low for the move at 3.6305, which is the lowest price since January 17, 2012 when May copper made a low of 3.6100. The market generated a short-term sell signal on April 9, but as of yet has not generated in intermediate term sell signal. Stand aside for now.
June gold closed $.40 lower on very light volume of 119,736 contracts. Open interest declined by 3,713 contracts, which almost negated the increase in open interest of 4,382 contracts made during April 9 and 10. Also of note, gold had an inside day, and an extremely narrow range of $10.40, which is a 62% decrease from its 21 day average true range of $27.60. Gold generated an intermediate term sell signal on March 15, and as I have said many times before, speculators should use this as an opportunity to acquire gold at lower prices.
May silver closed 15 cents lower on volume of 54,040 contracts. Open interest increased on the decline by 479 contracts. The problem I have with silver is that the volume and open interest action in conjunction with price has been dismal. Silver generated in intermediate term sell signal on April 5, 2012. Stand aside.
The June Euro closed 22 points higher on volume of 228,026 contracts. Open interest increased by 1,033 contracts. The market generated an intermediate term sell signal on April 4. Wait for a further rally before implementing short positions. As I write this on April 12, the June Euro is 1.12 cents higher. I will let readers know when the risk reward ratio is more favorable for bearish positions. The Euro has support at the 1.30 level going back to January 27. Stand aside.
The June Australian dollar closed 42 points higher on volume of 112,912 contracts. Open interest declined by 3,428 contracts. Open interest action continues to be negative when compared to price action. The market is on a short-term sell signal, and I will apprise readers when bearish positions should be implemented. As I write this on April 12, the June Australian dollar is 1.48 cents higher. Stand aside.
S&P 500 E mini:
The June S&P 500 E mini closed 7.50 points higher on volume of 1,742,363 contracts. Open interest declined by 18,840 contracts. April 11 was the first rally day since April 2, and as I write this on April 12, the S&P 500 E mini is 17.25 points higher. Additionally, all commodities, precious metals and currencies are moving higher. The recent down move that took the S&P 500 E mini to below its 50 day moving average, may be a garden-variety correction, or that the current move higher may be a dead cat bounce. In either scenario, speculators should have long put protection in place.