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Soybeans:

May soybeans lost 8.00 cents on volume of 233,812 contracts. Total open interest declined by 3,237, which relative to volume is approximately 40% below average.The March contract accounted for loss of 13,427 contracts. As this report is being compiled on February 26, May soybeans are trading 13.75 cents higher on the day. May soybeans have yet to break above the 10.32 high made on February 24. Although, we think soybeans can continue the rally, the reality is the market does not have the underpinnings for a sustained move higher. For this reason, we recommend that clients stand aside. We will be monitoring the market for a spot to initiate bearish positions once a sell signal has been generated. On February 20, May soybeans generated a short term buy signal, but remains on an intermediate term sell signal.

Soybean meal:

May soybean meal lost $5.90 on volume of 114,624 contracts. Total open interest declined by 4,899 contracts, which relative to volume is approximately 60% above average meaning that liquidation was heavy on the decline. The March contract lost 8,359 of open interest. As this report is being compiled on February 26, May soybean meal is trading 2.60 higher.On February 19, May soybean meal generated a short-term buy signal, but remains on intermediate-term sell signal. Like soybeans, soybean meal can continue its rally, but we think it’s on borrowed time.

Corn:

May corn lost 1.75 cents on volume of 434,091 contracts. Total open interest declined by a massive 27,141 contracts, which was due to the loss of 35,625 contracts in March. As this report is being compiled on February 26, May corn is trading 4.50 higher on the day. May corn remains on a short and intermediate term sell signal. Stand aside

WTI crude oil:

April WTI crude oil gained $1.71 on volume of 956,401 contracts. Total open interest increased by 18,333 contracts, which relative to volume is approximately 20% below average. The April contract gained 2557 of open interest. As this report is being compiled on February 26, the April contract has reversed course and is now trading 2.87 lower and is trading on the lows of the day. On February 13, WTI generated a short-term buy signal, but remains on intermediate-term sell signal. April WTI will generate a short-term sell signal, if the high of the day is below OIA’s key pivot point for February 26 of $49.63. Stand aside.

Brent crude oil:

April Brent crude oil gained $2.97 on volume of 778,512 contracts. Total open interest increased by 15,257 contracts, which relative to volume is approximately 20% below average.The April contract lost 3,422 of open interest. As this report is being compiled on February 26, April Brent is trading 1.65 cents lower, or -2.40% versus the loss in WTI of 5.51%. The spread between April Brent and April WTI has widened considerably and is currently trading 11.68 premium to Brent. Stand aside.

Copper: On February 25, May copper generated a short-term buy signal, but remains on the intermediate term sell signal.

May copper gained 1.55 cents on volume of 82,646 contracts. Total open interest declined by 5090 contracts, which relative to volume is approximately 120% above average meaning that liquidation was heavy on the modest advance. The March contract accounted for loss of 14,093 contracts of open interest.For the past couple of days, the March contract has inverted and is selling at a premium to May, which may indicate some near-term tightness. The market should find resistance at OIA’s key pivot point of $2.7497. A daily low above the pivot point would generate an intermediate term buy signal.

Gold: This will be our final report on gold until we announce a signal change or see a trading opportunity. April gold generated a short-term sell signal on February 9 and an intermediate term sell signal on February 24.

April gold gained $4.20 on volume of 116,430 contracts. Total open interest declined by 2,336 contracts, which relative to volume is approximately 20% below average. As this report is being compiled February 26, April gold is trading 8.80 higher on the day. Stand aside.

Silver:

May silver gained 24.1 cents on heavy volume of 97,558 contracts. Total open interest declined by 3,146 contracts, which relative to volume is approximately 35% above average meaning that liquidation was substantial on the advance. Accounting for the large total open interest decline was the out sized decline in the March contract of 13,581 of open interest. As this report is being compiled on February 26, May silver is trading 15.6 cents higher.On February 18 May silver generated a short-term sell signal, but remains on intermediate term buy signal. Stand aside.

Cocoa:

May cocoa lost $58.00 on volume 33,990 contracts.Volume was the strongest since February 12 when cocoa advanced 35.00 on volume of 46,808 contracts and total open interest increased by 743 contracts. On February 25, total open interest increased by massive 4,525 contracts, which relative to volume is approximately 450% above average meaning that new short-sellers were entering the market in large numbers and aggressively selling cocoa to a new low for the move of 2952. The March contract accounted for loss of 537 of open interest, which makes the total open interest increase more impressive (bearish). As this report is being compiled after the close, May cocoa has gained $22.00 after making a daily low of 2924, which is the lowest print since 2919 made on February 18. We continue to advise a sideline stance.

Coffee:

May coffee lost 5.45 cents on heavy volume of 39,349 contracts. Volume was the strongest since February 18 when May coffee lost 1.90 cents on volume of 48,082 contracts and total open interest increased by 293 contracts.On February 25, Total open interest increased by massive 4,048 contracts, which relative to volume is approximately 310% above average meaning that aggressive new short-sellers were entering the market in large numbers and driving prices to a new low for the move (1.4235). The March contract accounted for a loss of just 14 contracts.

As this report is being compiled on February 26, May coffee has closed lower again, this time by 2.90 cents. As we have said in previous reports, the very weak Brazilian currency against the dollar is creating a major export boom of coffee on the world market, which is depressing prices. However, exportable surpluses are being drawn down, and when this meets the anticipated crop shortfall, we expect to see coffee prices explode to the upside. May coffee remains on a short and intermediate term sell signal. Stand aside.