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On March 23, the June dollar index is trading sharply lower and this is giving a bid to many commodities.

The USDA will release its grain stocks and planting intentions report on March 31.

Soybeans:

May soybeans gained 12.00 cents on volume of 207,937 contracts.Total open interest increased 936 contracts, which relative to volume is approximately 75% below average. The May contract lost 4,736 of open interest, which makes the modest increase of open interest somewhat more impressive (bullish). As this report is being compiled on March 23, May soybeans are trading higher again, up by 14.50 cents and have made a daily high of 9.89 1/4, which is the highest print since 9.94 made on March 13. May soybeans remain on a short and intermediate term sell signal, and we see this as a bear market rally with the dollar index providing the impetus for a higher market.

Soybean meal:

May soybean meal gained $4.70 on volume of 75,613 contracts. Total open interest increased by 999 contracts, which relative to volume is approximately 40% less than average. The July contract accounted for loss of 205 open interest. As this report is being compiled on March 23, May soybean meal is trading 4.50 higher and has made a daily high of 329.00, which is the highest print since 333.00 made on March 13. Like soybeans, the higher meal market is the result of the major decline in the dollar index. May soybean meal remains on a short and intermediate term sell signal.

Corn:

May corn gained 11.50 cents on heavy volume of 377,726 contracts. Volume with the highest February 25 when 434,091 contracts were traded and May corn lost 1.75 cents and total open interest declined by 27,141 contracts. On March 20, total open interest declined by a massive 22,003 contracts, which relative to volume is approximately 140% above average meaning liquidation was extremely heavy on the advance.

As this report is being compiled on March 23, May corn is trading 4.75 cents higher and has made a daily high 3.91 1/4, which takes out Friday’s high and is the highest print since 3.92 made on March 12. Again, we see the corn move as a rally in a bear market, however the wheat market has been strong and this is supporting corn. May corn remains on a short and intermediate term sell signal.

Chicago wheat: May Chicago wheat will generate a short-term buy signal on March 23.

May Chicago wheat gained 18.00 cents on volume of 100,657 contracts.Total open interest declined by 818 contracts, which relative to volume is approximately 65% below average. As this report is being compiled on March 23, May Chicago wheat is trading 3.50 higher and has made a new high for the move of 5.40 1/2.The market has rallied very strongly during the past four days, and is well overdue for a pullback. At this juncture we recommend a stand aside posture.

Kansas City wheat: On March 20, May Kansas City wheat generated a short-term buy signal, but remains on intermediate-term sell signal.

May Kansas City wheat gained 19.25 cents on volume of 27,188 contract. Total open interest declined by a massive 1,767 contracts, which relative to volume is approximately 150% above average meaning liquidation was extremely heavy on the advance.As this report is being compiled on March 23, May Kansas City wheat is trading 4.25 cents higher and has made a daily high of 5.79 1/4. The market is overbought and well overdue for correction. Stand aside.

Live cattle: On March 23, June live cattle will generate an intermediate term buy signal after generating a short-term buy signal on March 5.

June live cattle gained 25 points on volume of 48,395 contracts. Total open interest increased by 1,034 contracts, which relative to volume is approximately 15% below average. However, the April contract lost 3315 of open interest, which makes the total open interest increase more impressive (bullish).As this report is being compiled on March 23, June live cattle is trading 1.95 cents higher and has made a daily low of 1.51225, which is above OIA’s key pivot point for March 23 1.50400. Therefore, June live cattle will generate an intermediate term of buy signal on March 23. On March 5, the June contract generated a short-term buy signal.

WTI crude oil:

May WTI crude oil gained $1.04 on volume of 663,323 contracts. Total open interest declined by 17,101 contracts, which relative to volume is average. The April contract lost 16,145 open interest. As this report is being compiled on March 23 May WTI crude oil is trading 30 cents above Friday’s close and is made a daily high of 47.22, which is below Friday’s high of 47.43.May WTI remains on the short and intermediate term sell signal. Stand aside.

Gold:

April gold gained $15.60 on volume of 205,681 contract. Total open interest increased by 348 contracts, a major disappointment.However, the April contract lost 10,716 of open interest, which makes the total open interest more impressive (bullish). As this report is being compiled on March 23 April gold is trading 1.50 higher and has made a high of 1188.80, which is only slightly above Friday’s high of 1187.40. In short, the sharply lower dollar is not boosting gold prices. For April gold to generate a short-term buy signal, the low of the day must be above OIA’s key pivot point for March 23 of 1195.80. Stand aside. 

Silver: May silver will generate a short-term buy signal on March 23 because the low of the day (16.610) is above OIA’s key pivot point for March 23 of 16.431.

May Silver gained 76.9 cents on strong volume of 65,364 contracts. Total open interest declined by 1298 contracts, which relative to volume is approximately 20% below average, however an open interest decline on the move of the magnitude seen on Friday is disappointing to say the least. On March 19, May silver gained 57.3 cents and total open interest declined by 2,175 contracts. In short, the dominant activity for the past two trading days has been massive short covering, which has been powering prices higher. This sharp move higher is going to generate a short term buy signal on March 23.We recommend a stand aside posture.

Copper: On March 23, May copper will generate an intermediate term buy signal after generating a short term buy signal on February 25.

May copper advanced a strong 10.10 cents on very heavy volume of 91,357 contracts.Volume was the strongest since February 24 when 104,433 contracts were traded and May copper closed at 2.6395. On March 20, Total open interest increased by a very strong 4,591 contracts, which relative to volume is approximately 100% above average.

As this report is being compiled on March 23, May copper has closed at 2.7895, up 2.85 cents. On February 25, May copper generated a short-term buy signal, and an intermediate term buy signal will be generated on March 23 because the low of the day (2.7550) is above OIA’s key pivot point for March 23 of 2.7364. Conceivably, the May contract could rally to the 200 day moving average of 2.9525, but we do not think fundamentals justify a move much higher.

Coffee:

May coffee lost 80 ticks on volume of 17,846 contracts. Total open interest increased by 172 contracts, which relative to volume is approximately 50% below average. May contract lost 345 open interest. As this report is being compiled on March 23, May coffee has closed down 1.50 cents. May coffee remains on a short and intermediate term sell signal. Stand aside.