May corn closed 9 1/2 cents higher on volume of 363,976 contracts. Open interest declined on the rally by 3,956 contracts. The volume on Friday was the highest since February 28 when 420,267 contracts were traded. The USDA released its stocks report, and although it was considered neutral for corn, the market rallied. The last three days open interest action has been bearish. As I am writing this report on March 12, corn is currently $.13 higher having made a high of 661 1/2. The recent high for the move occurred on March 5 when corn reached 665 1/4. When I get volume and open interest data on corn tomorrow, perhaps the direction of corn will be made clear. It is unusual to see strong rallies in commodities when the dollar is sharply higher as we saw on Friday.
May soybeans closed 3/4 of a cents lower on heavy volume of 283,147 contracts. Open interest increased by 10,878 contracts. The market made a new high at 1355. Market is due for a correction, but a major bull trend may be developing. Stand aside.
May sugar closed 30 points lower on volume of 100,025 contracts. Open interest declined by
7,864 contracts. The market performance since late February has been abysmal, but sugar has not generated a sell signal yet. Stand aside.
The March Euro closed 1.51 cents lower on heavy volume of 343,000 contracts. Consistent with its bear market action, open interest increased on the decline by 8,235 contracts. Volume was the heaviest since February 29 when the Euro traded 351,274 contracts on a day that saw a loss of 1.19 cents. If the market is unable to breach my key pivot point of 1.3248, a sell signal will be generated. As I am writing this on March 12, the high for the day is been 1.3158, which is 90 points below the key pivot point.
S&P 500 E mini:
The June S&P 500 E mini closed 6.25 points higher on very heavy volume of 2,967,827 contracts. Open interest increased by a massive 112,526 contracts. It is important to know that open interest data and volume cannot be relied upon for signals when the contract is within 2 to 3 weeks of its expiration. Long put protection should be in place.
April crude oil closed $.82 higher on volume of 679,455 contracts. Open interest increased by 14,069 contracts. As I stated in the March 12 weekend wrap, I believe we are at a critical juncture with respect to the price of crude oil. If the market breaks out to a new high, the impact on the equities market will be negative. Crude oil is a very crowded trade right now and the number of net longs is at record highs. Stand aside.
April gasoline closed 1.84 cents higher on light volume of 128,839 contracts. Open interest increased by 2,073 contracts. Volume on Friday was the lightest since March 5 when crude oil traded 120,352 contracts. Friday’s high of 3.3407 was the highest price since March 1 when gas topped out at 3.3868. Volume on March 1 (176,612 contracts) was the highest number of contracts traded in a number of months. The high of March 1 may stand as the high water mark in the short term. Stand aside and wait for lower prices.
April gold closed $12.80 higher on healthy volume of 231,977 contracts. Open interest declined by 1,670 contracts. Friday’s volume was the highest since March 6 when gold traded 272,862 contracts and gold fell $31.80. The market appears to be consolidating, which is very healthy in a bull market. Contrary to past performance, the precious metals rallied in the face of the sharply higher dollar.
May silver closed $.38 higher on volume of 65, 329 contracts. Open interest increased by 1,137 contracts. Stand aside