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Soybeans:

July soybeans lost 2.25 cents on volume of 224,937 contracts. Volume was the lightest since June 8 when the July contract advanced 6.50 cents on volume of 205,673 contracts and total open interest declined by 1,671. On June 15, total open interest increased by 3,114 contracts, which relative to volume is approximately 40% below average. The July contract lost 6,833 of open interest and there were sufficient open interest increases in the forward months to offset this decline and increase total open interest.

As this report is being compiled on June 16, the July contract is trading 11.00 cents higher and has made a daily high of 9.49 1/2, which is the highest print since 9.53 made on June 11. For July soybeans to generate a short-term buy signal, the low of the day must be above OIA’s key pivot point for June 16 of 9.49 1/2.

The trend will accelerate on the downside if the July contract makes a daily high low OIA’s key pivot point for June 16 of 9.36. Yesterday, it appeared that soybean oil was on the verge of generating a short-term sell signal but this is not going to occur on June 16, which should lend support to soybeans.

Also, soybean meal is providing support on June 16 (+1.44%) and in the latest COT report, managed money became net long for the first time in several weeks. With the likelihood of soybean meal generating a short-term buy signal on June 16 and soybean oil on already on short and intermediate term buy signals, the chance is very good that soybeans will generate a short-term buy signal within the next couple of days. July soybeans remain on the short and intermediate term sell signal

Soybean oil:

July soybean oil lost 45 points on heavy volume of 223,015 contracts. Volume was the strongest since May 29 when the July contract gained 1.27 cents on volume of 224,730 contracts and total open interest increased by 1,840.On June 15, total open interest declined by 1,401 contracts, which relative to volume is approximately 65% below average. The July contract lost 8,773 of open interest, August 2015 -992.

As this report is being compiled on June 16, the July contract is trading 7 points higher and has made a daily high of 33.08 which is one point below yesterday’s high of 33.09. For the July contract to generate a short-term sell signal, the high of the day must be below OIA’s key pivot point for June 16 of 32.66. For the rally to resume, the low of the day must be above OIA’s key pivot point for June 16 of 33.36. July soybean oil remains on a short and intermediate term buy signal.

Soybean meal: We are commencing coverage on soybean meal due to the likelihood of it generating a short-term buy signal on June 16.

July soybean meal lost $4.20 on heavy volume of 155,560 contracts.Volume traded on June 15 was one of the highest of 2015 and exceeded that of February 24 when 154,595 contracts were traded and July 2015 soybean meal closed at $342.00. On June 15, total open interest declined by 5,113 contracts, which relative to volume is approximately 10% above average meaning liquidation was heavier than normal. The July contract lost 14,127 of open interest.

Yesterday’s open interest decline is positive as it accompanied lower prices. As this report is being compiled on June 16, the July contract is trading$4.20 above yesterday’s close and has made a high of 318.70, which takes a yesterday’s print of 318.20. July soybean meal will generate a short-term buy signal on June 16 if the low for the day of 311.50 holds. It should be noted that July soybean meal never made a new contract low during the time that soybeans were making new lows. The July contract made its contract low of 294.40 on October 3, 2014. 

Corn:

July corn lost 4.75 cents on heavy volume of 564,924 contracts. Volume exceeded that of June 12, June 11 and was only surpassed by the activity on June 10, the day of the WASDE report when the July contract lost 7.75 cents on volume of 699,375 contracts and total open interest increased by 9,345.

On June 15, total open interest increased by 3,794 contracts, which relative to volume is approximately 60% below average, but an open interest increase on yesterday’s price decline is bearish. Additionally, the July contract lost 33,759 of open interest which means there were sufficient open interest increases in the forward months to offset this decline and increase total open interest.

Yesterday, the July contract made a new contract low of 3.46 3/4 and this has not been taken out on June 16.The strong meal market should support corn, but the fact is the only thing weaker than corn is wheat. For a short-term buy signal to be generated, the July contract must make a daily low above OIA’s key pivot point for June 16 of 3.62 3/8.

Chicago wheat: July Chicago wheat will generate an intermediate term sell signal on June 16, but will not generate a short-term sell signal.

July Chicago wheat lost 14.50 cents on volume of 164,928 contracts. Surprisingly,total open interest did not increase on yesterday’s price decline, but lost 1,976 of open interest, which relative to volume is approximately 45% below average. The July contract lost 10,627 of open interest, December 2015 -436. For a short-term sell signal to be generated, the high of the day must be below OIA’s key pivot point for June 16 of 4.92 1/2.

WTI crude oil:

July WTI crude oil lost 44 cents on light volume of 563,147 contracts. Volume increased from June 12 when the July contract lost 81 cents on volume of 512,150 contracts and total open interest increased by 446. On June 15, total open interest declined by 11,941 contracts, which relative to volume is approximately 20% below average. The July contract accounted for loss of 26,729 of open interest. As this report is being compiled on June 16 the July contract is trading 35 cents above yesterday’s close. July WTI remains on a short-term sell signal, but an intermediate-term buy signal. We see no reason to be involved in the market.

Natural gas:

July natural gas advanced 13.9 cents on heavier than normal volume of 402,094 contracts Volume was below that of June 11 when July natural gas lost 6.6 cents on volume of 448,487 contracts and total open interest declined by 5,267. On June 15, total open interest increased by massive 17,677 contracts, which relative to volume is approximately 70% above average meaning that aggressive new buyers were entering the market in heavy numbers and driving prices higher ($2.919), which also was the high print on June 11.The July contract lost 16,592 of open interest, which means there was sufficient open interest increases in the forward months to offset this decline and dramatically increase total open interest.

Despite positive price and open interest action, natural gas has been unable to generate a short or intermediate term buy signal. However, it looks increasingly likely this will occur, possibly this week. In order for a short-term buy signal to be generated, the low of the day must be above OIA’s key pivot point for June 16 of 2.861.

Managed money is massively short and this would provide significant buying power if prices continued their advance. As this report is being compiled on June 16, the July contract is trading nearly unchanged on the day and has made a daily low of 2.831, which is above yesterday’s low of 2.764. Although natural gas is on a short and intermediate term sell signal, we strongly advise against shorting this market.

Dollar index:

The September dollar index lost 13.5 points on light volume of 40,183 contract. Total open interest increased by 216 contracts, which relative to volume is approximately 75% below average, however, an open interest increase on yesterday’s price decline is bearish.

Surprisingly, although the June contract is near expiration, it gained 50 of open interest. As this report is being compiled on June 16, the September contract is trading 17.3 points above yesterday’s close. It is likely the British pound will generate a short-term buy signal on June 16, and with the euro being on a short and intermediate term buy signal, a continued advance in these two currencies should continue to pressure the dollar index.

Euro:

The September euro gained 22 pips on light volume of 213,571 contracts. Total open interest declined by 4,429 contracts, which relative to volume is approximately 20% below average, but liquidation in the euro continues as prices are firm and trade in a sideways to higher pattern. The June contract lost 6,139 of open interest.

As this report is being compiled on June 16, the September contract is trading 45 pips lower and has made a daily low of 1.1218, which is above yesterday’s low of 1.1204. As we have commented before, the euro has been trading positively despite the chaos involving Greece. This bodes well for a continuing advance. On June 4, the September euro generated a short and intermediate term buy signal.

British Pound: The September British pound will generate a short-term buy signal on June 16, which reverses the short-term sell signal of June 1. It remains on an intermediate term buy signal.

The September British pound advanced 53 pips on the surprisingly light volume of 67,024 contracts. Volume was almost cut in half from June 12 when the September contract gained 35 pips on volume of 132,734 contracts and total open interest increased by 2,847.

On June 15, total open interest increased again, this time by 536 contracts, which relative to volume is approximately 55% below average, however, the June contract accounted for loss of 1,231 of open interest, which makes the total open interest more impressive (bullish). As this report is being compiled on June 16, the September contract is trading 33 pips above yesterday’s close and has made a new high for the move of 1.5639, which is the highest print since 1.5665 made on May 22.The September contract is headed for a test of the May 14 high of 1.5800.