May corn closed .$.01 cent higher on low volume of 268,964 contracts. Open interest increased by 4,602 contracts. As I’ve said before, May corn is above my key pivot point of 6.44 3/4 and therefore should be traded from the long side. Use relatively tight stops in the event the corn market is brought down by a a stronger dollar (which I consider unlikely) or a slide in the equities market, which I consider to be quite likely.
May soybeans closed 10 1/2 cents higher on volume of 188,907 contracts. Open interest increased by 3,078 contracts. The market closed at a new high and we continue to be massively over extended. As I’ve mentioned before, partial profits should be taken on long positions and/or protective sell stops should be moved up to protect profits and capital.
May sugar closed 11 points higher on very light volume of 83,515 contracts. Open interest increased by 1,312 contracts. As I’ve mentioned before, the market should be traded from the long side with stop placement based upon risk tolerance and sound money management principles.
April crude oil closed $2.14 lower on fairly light volume of 625,949 contracts. Open interest declined by 4,497 contracts, which is positive market action. It is important to note that lately volume significantly diminishes on corrections, while it increases on rallies. This is bullish. As I mentioned in the weekend wrap, the market is going to trade on the headlines that come out of the meeting between the president and the prime minister of Israel. Despite the positive performance of crude oil, I cannot suggest that long positions be implemented due to the change in geopolitical tensions that can be positive or negative for oil.
April gasoline closed 7.96 cents lower on fairly light volume of 132,272 contracts. Open interest declined by 2,474 contracts, which is positive market action. As I indicated in the previous paragraph about crude oil, the decline of volume when price declines is positive. Continue to stand aside and wait for lower prices.
April gold closed $12.40 lower on volume of 163,519 contracts. Open interest declined by 10, 876 contracts. During the past three sessions, open interest has declined a total of 32,976 contracts. As I have mentioned before, gold is trading in a value zone, based upon the 50,150, 200 day moving averages, which are in the range of 1672.00 and 1714.00. I have suggested long positions, with the caveat that a protective sell stop be placed at 1688.40, which was the low of February 29. My key downside pivot point stands at 1681.30. If the daily high does not exceed the price of the pivot point, gold will have a sell signal. If the equities market turns down and/or the dollar rallies, I expect gold to move lower. If a sell stop is triggered, there probably will be an opportunity to get long at lower prices.
May silver closed $1.13 lower on very light volume of 41,517 contracts. Open interest declined by 1,072 contracts. Friday’s volume, was the lowest since January 30, 2012 when 33,553 contracts were traded. The fact that silver traded sharply lower on very low volume and open interest declined on the move, is a very positive development. Due to the volatility of the commodity, I suggest that speculators use ETF’s to participate in the market, rather than futures. This is not a suggestion to get long silver at these levels, rather it is a recommendation to reduce the risk of trading silver.
The March Euro closed 1.10 cents lower on volume of 273,141 contracts. Open interest continued its bearish pattern on price declines by increasing 6,669. If the market does not trade above 1.3254, a sell signal will be generated.
S&P 500 E mini:
The March S&P 500 E mini closed 6.00 points lower on light volume of 1,480,002 contracts. Open interest increased by 17, 973 contracts. Long put protection should be in place.
10 Year Treasury Notes:
June treasury notes closed 16 points higher on very light volume of 969,995 contracts. Open interest decreased 21,018 contracts on the advance, which is bearish. The volume action was decidedly bearish having traded 501,387 fewer contracts than on March 1. Stand aside.