March corn closed $.07 lower on volume of 342,309 contracts. Open interest increased by 5,378 contracts. The market made a new low for the move at 6.25 1/4, which is the lowest price for March corn since January 24 and the lowest close since January 23. My opinion on corn for well over a month has been to stand aside. A review of my previous posts explains why I have held this view. Nothing has changed, and the next key pivot to watch for is 6.23 1/8. If the market’s high is below 6.23 1/8, then we are headed lower, perhaps significantly so.
March soybeans closed $.06 higher on healthy volume of 250,315 contracts. Open interest declined by 298 contracts. Beans made a new high at 12.69 and made a new closing high of 12.61. This was the highest close since October 18, 2011. I continue to like this market, and as I’ve said before, sell stop placement should be based upon risk tolerance and sound money management principles. The market is very overbought at these levels and the 50 day moving average is 11.92. Since January 31, March soybeans have advanced 75 3/4 cents or 6.39%. The stop that I originally suggested was at 12.14. It is conceivable that if the outside markets tumble, we could see soybeans back down to that level. Although I am bullish, at this level I am a cautious bull.
March sugar closed 24 points higher on volume of 131 641 contracts. Open interest declined by 13,459 contracts. Stand aside.
March crude oil closed $1.06 higher on healthy volume of 792,027 contracts. Open interest declined by 9,207 contracts. This is the second day in a row that open interest has declined as crude prices rallied. The market reached a new high for the move at 102.54. There is formidable resistance in the 103 area going back to November of 2011. March crude oil reached a high on November 11 of 103.20 and that high was taken out slightly on January 4 when crude oil reached 103.88. Any significant increase tensions with Iran could propel the market above the 103 resistance area. Stand aside.
March gasoline closed 2.42 cents higher on healthy volume of 183,304 contracts. Open interest increased by 3,904 contracts. Also, the market made a new high at 3.0366 per gallon. We been sitting on the sidelines waiting for a pullback and it hasn’t happened. However, purchasing gasoline, or its ETF (UGA) at these levels can be hazardous. I still prefer to wait for a pullback. The pullback may occur as a result of a significant downward move in the outside markets. Stand aside.
Gold closed $9.80 higher on volume of 150,864 contracts. Open interest increased by a whopping 7, 010 contracts. Stand aside.
March silver closed $.06 higher on volume of 67,809 contracts. Open interest increased 1,749 contracts. Stand aside.
The March Euro closed 31 points lower on volume of 321,995 contracts. Open interest increased by 8,025 contracts. The increase in open interest on price declines and declining open interest on price rallies has typified the market action and is indicative of the continuing bear market in the Euro. The February 15 low of 1.3045 is the lowest price since February 6. On rallies, implement either/and, long puts, short calls, or outright short positions. Use the February 9 high of 1.3325 as a point to exit the aforementioned positions.
S&P 500 E mini:
The March S&P 500 E mini reached a new high for the move that began on October 4, 2011 at 1358.00. Although the market reached the high based upon the ever-changing dynamics of the Greek financial situation, the market sold off to close 5.50 points lower on volume of 2,285,987. Open interest increased by 5,117 contracts. Long put positions should be in place.