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Soybeans:

May soybeans gained 11.50 cents on volume of 295,408 contracts. Volume was the highest since April 9 when May soybeans lost 18.00 cents on volume of 335,819 contracts and total open interest increased by 13,403 contracts.On April 14, total open interest increased by 1,281 contracts, which relative to volume is approximately 80% below average. However, the May contract lost 25,916 of open interest, which makes the total open interest increased more impressive (bullish).

The open interest increase in yesterday’s trading indicates that short sellers were not panicking. As this report is being compiled on April 15, May soybeans are trading 6.00 cents above yesterday’s close and have made a daily high of 9.76 3/4, which is above yesterday’s high of 9.61 1/2.Periodic rallies should be expected, and these should be used to initiate bearish positions. May soybeans remain on a short and intermediate term sell signal.

Soybean meal:

May soybean meal gained $4.80 on volume of 124,281 contracts. Total open interest increased by 1,635 contracts, which relative to volume is approximately 40% less than average. However, the May contract lost 10,209 open interest, which makes the total open interest increase more impressive (bullish). As this report is being compiled on April 15, May soybean meal is trading 40 cents lower even though soybeans are trading higher on the day. Soybean oil is the strong member of the complex on April 15.May soybean meal remains on a short and intermediate term sell signal

Corn:

May corn gained 3.00 on volume of 385,550 contracts. Total open interest increased by 11,120 contracts, which relative to volume is average. The May contract lost 25,051 of open interest, which makes the total open interest increase more impressive (bullish). As this report is being compiled on April 15, May corn is trading 2.00 cents higher and has made a daily high of 3.79, which is the highest print since 3.79 1/2 made on April 10. As we said in yesterday’s report, we think the short side of corn should be avoided due to the upcoming planting season and the possibility of weather related issues. Remarkably, the market has not broken down and remains 10% above its contract low made on October 1.

Chicago wheat: On April 14, May and July Chicago wheat generated short-term sell signals and remain on intermediate term sell signals.

May Chicago wheat lost 3.75 cents on heavy volume of 205,588 contract. Volume fell from April 13 when May Chicago wheat lost 24.25 cents on volume of 212,334 contracts and total open interest increased by 11,187. On April 14, total open interest increased by 7,443 contracts, which relative to volume is approximately 45% above average meaning new short-sellers were entering the market aggressively and driving prices to a new low for the move (4.96 1/4). As this report is being compiled on April 15, May Chicago wheat is trading 2.25 cents lower was made a daily low of 4.94.

Kansas City wheat: On April 14, May and July Kansas City wheat generated short-term sell signals and remain on intermediate-term sell signals.

May Kansas City wheat lost 7.25 cents on volume of 46,030 contracts. Total open interest increased by massive 2,817 contracts, which relative to volume is approximately 140% above average meaning aggressive new short-sellers were entering the market in large numbers and driving prices to a new low for the move (5.20). The May contract accounted for loss of 3566 of open interest, which makes the total open interest increase more impressive (bearish). As this report is being compiled on April 15, May Kansas City wheat is trading 3.75 cents lower.

Live cattle:

June live cattle gained 1.475 cents on light volume of 42,807 contracts. Total open interest increased by 2,713 contracts, which relative to volume is approximately 145% above average meaning that aggressive new longs were entering the market and driving prices higher (1.50925).The April contract lost 994 of open interest. As this report is being compiled on April 15, June live cattle is trading 90 points higher and has made daily high of 1.51975, which is slightly above OIA’s key pivot point of 1.51965.

In order for the sell signal generated on April 13 to reverse, the low of the day must be above the pivot point. April 15 is the second day of the counter trend rally and conceivably we could see one more final thrust higher, but much of this will depend upon how volume and open interest performs on April 15. For strategies involving live cattle, please call.

WTI crude oil: On April 14 May and June WTI generated intermediate term buy signals after generating short-term buy signals on April 7.

May WTI crude oil gained $1.38 on heavy volume of 992,133 contracts. Volume was the highest since April 8 when May WTI lost $3.56 on volume of 1,136,045 contracts and total open interest declined by 34,980. On April 14, total open interest increased by massive 35,566 contracts, which relative to volume is approximately 45% above average, which is a huge number for WTI. Making the total open interest increase more impressive is that the May contract lost 35,650 of open interest. As this report is being compiled on April 15, May WTI is trading 2.52 higher and has made a daily high of 56.05, which is the highest print since 56.08 made on February 17. As it stands, May WTI is trading 26.39% above its contract low of 44.03 made on March 18.

As we pointed out in the April 9 report, price and open interest action was acting in a bullish congruent fashion, and this has continued through April 14. Although the latest EIA report showed the smallest increase in stocks in a couple of months, the fact is the market knew this long before it it became apparent. Our buy and sell protocols have kept clients on the right side of the market when everyone in the financial press and so-called experts were calling for $20-$40 WTI prices.

From the April 9 report:

“May WTI crude oil gained 37 cents on volume of 953,792 contracts. Although, total open interest increased just 1,955 contracts, the May contract lost 51,807 of open interest, which means there were sufficient open interest increases in the forward months to offset the decline in May and bring total open interest to a positive number. We consider this action to be bullish. From April 2 through April 9, price and open interest action has been acting in a bullish congruent fashion: open interest increases on price advances and declines on price decreases.”

The Energy Information Administration announced that U.S. commercial crude oil inventories (excluding those in the Strategic Petroleum Reserve) increased by 1.3 million barrels from the previous week. At 483.7 million barrels, U.S. crude oil inventories are at the highest level for this time of year in at least the last 80 years. Total motor gasoline inventories decreased by 2.1 million barrels last week, but are well above the upper limit of the average range. Both finished gasoline inventories and blending components inventories decreased last week. Distillate fuel inventories increased by 2.0 million barrels last week and are in the middle of the average range for this time of year. Propane/propylene inventories rose 2.1 million barrels last week and are well above the upper limit of the average range. Total commercial petroleum inventories increased by 7.2 million barrels last week.

Brent crude oil: On April 15, June Brent crude oil will generate a short and intermediate term buy signal.

June Brent crude oil gained 77 cents on volume of 821,940 contracts. Total open interest declined by 446 contracts.The May contract accounted for loss of 48,241 of open interest, however, there were insufficient increases of open interest in the forward months to bring total open interest to a positive number. The Brent crude contracts have been lagging WTI significantly in terms of price and open interest action. However, it appears this is about to change on April 15: June Brent crude oil is trading 2.55 higher and has made a daily high 63.47.

Heating oil: May heating oil will generate a short and intermediate term buy signal on April 15.

May heating oil gained 1.84 cents on volume of 200,402 contracts. Total open interest increased by 3,624 contracts, which relative to volume is approximately 20% below average. However, the May contract lost 6881 of open interest. As this report is being compiled on April 15, May heating oil is trading 6.97 cents higher and has made a daily low of 1.8090, which is above OIA’s key pivot point for April 15 of 1.7940 for a short-term buy signal and above the intermediate term pivot point of 1.7896. As a result, May heating oil will generate short and intermediate term buy signals on April 15.

Gasoline: On April 15, May gasoline will generate an intermediate term buy signal, but remains on a short term sell signal.

May gasoline advanced 3.14 cents on volume of 174,564 contracts. Total open interest increased by 68 contracts. As this report is being compiled on April 15, May gasoline is trading 7.58 cents higher, and will generate an intermediate term buy signal because the daily low of 1.8485 is above the intermediate term pivot point for April 15 of 1.8171. The short term pivot point for April 15 is 1.8498 and therefore May gasoline will not generate a short-term buy signal because the daily low is below the pivot point.

Gold:

June gold lost $6.70 on heavier than normal volume of 171,995 contracts. Total open interest increased by 2,916 contracts, which relative to volume is approximately 5% below average. The open interest increase on the price decline is bearish.As this report is being compiled on April 15, June gold is trading 5.50 higher on low volume. Although June gold remains on a short-term buy signal and intermediate-term sell signal, we recommend a stand aside posture.

Silver: On April 14, May and July silver generated an intermediate term sell signal, but remain on short term buy signals. 

May silver lost 13.00 cents on volume of 58,966 contracts. Total open interest increased by 3,152 contracts, which relative to volume is approximately 115% above average, meaning that aggressive new short-sellers were entering the market in very large numbers and driving prices to a new low for the move (15.955).The silver market continues to perform a lackluster fashion and we recommend a stand aside posture.

Cocoa: On April 14, July cocoa generated a short-term buy signal, but remains on intermediate-term sell signal.

July cocoa advanced $49.00 on volume of 45,061 contracts. Total open interest declined by 2,427 contracts, which relative to volume is approximately 105% above average, however, the May contract lost 6487 of open interest and will continue to lose open interest as it approaches first notice day. As is usually the case after the generation of a buy signal, the market has a tendency to pull back from 1-3 days and this is the opportunity to initiate bullish positions if you’re so inclined. As this report is being compiled on April 15, July cocoa has closed $22.00 lower and the market should continue to have a continued correction for another day or two.

Coffee:

July coffee gained 45 ticks on heavy volume of 63,834 contracts. Total open interest has declined by a massive 4,537 contracts, which relative to volume is approximately 185% above average meaning liquidation was extremely heavy on the modest gain. The May contract accounted for loss of 9922 of open interest, December 2015 -468. As this report is being compiled on April 15, July coffee is trading 1.25 cents higher on the day. July coffee remains on a short-term buy signal, but an intermediate term sell signal. At this juncture we recommend a stand aside posture.