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Corn:

March corn lost 5.50 cents on volume of 267,195 contracts. Total open interest increased by a large 9,532 contracts, which relative to volume is approximately 20% above average, meaning that new short-sellers were entering the market in large numbers and driving prices lower (3.67). Additionally, the December contract lost 30,386 of open interest, which means there were sufficient open interest increases in the forward months to offset the decline in December and increase total open interest substantially.

The action on November 27 was bearish.For March corn to generate a short-term buy signal, the low of the day must be above OIA’s key pivot point for November 30 of 3.79 3/8. March corn remains on short and intermediate term sell signals. We have no recommendation.

Soybeans: January soybeans will generate a short-term buy signal if the daily low is above OIA’s key pivot point for November 30 of 8.78 3/4.

January soybeans lost 2.50 cents on volume of 100,287 contracts. Total open interest increased by 4,330 contracts, which relative to volume is approximately 70% above average meaning aggressive new short-sellers were entering the market and driving prices lower (8.71). The January contract gained 816 of open interest.

As this report is being compiled on November 30, the January contract is trading 9.50 cents above Friday’s close, and is close to generating a short-term buy signal. Although soybeans will likely struggle, the fact that soybean oil is now on short and intermediate term buy signals may provide support. January soybeans remain on short and intermediate term sell signals. We have no recommendation.

Soybean oil: On November 27, January and March soybean oil generated short and intermediate term buy signals.

January soybean oil lost 13 points on volume of 109,310 contracts. Total open interest increased by 376 contracts and the December contract, which enters first notice day on November 30 lost 7,212 of open interest. As this report is being compiled on November 30, the January contract is trading 36 points higher and has made a new high for the move of 29.64, which is the highest print since 29.75 made on October 22. We have no recommendation.

WTI crude oil:

The January WTI contract lost $1.33 on volume of 443,142 contracts. Total open interest increased by 3,412, which relative to volume is approximately 55% below average. The January contract lost 1,832 of open interest. As this report is being compiled on November 30, the January contract is trading 8 cents above Friday’s close and has made a daily low of 41.50, which is below Friday’s print of 41.67. January WTI remains on short and intermediate term sell signals. We have no recommendation.

Dollar index:

The December dollar index advanced 24.3 points on light holiday volume of 16,695 contracts. However, total open interest increased substantially, up 728 contracts, which relative to volume is approximately 75% above average meaning aggressive new buyers were entering the market in substantial numbers and driving prices to a new high for the move of 100.255. As this report is being compiled on November 30, the December contract is trading higher again, up 25.2 points and has made another new high for the move of 100.360.

This week, there are two main events: the decision by the ECB to decide the degree to which quantitative easing continues and the amount of money printing to be provided. On Friday, the employment report will be released by the US Department of Labor, and if it is within the expected range, the interest rate hike priced into the market will likely occur when the Federal Reserve makes their announcement on December 16. At this juncture, it is not possible to determine the degree to which this has already been priced into the dollar index. We recommend a stand aside posture.

Australian dollar:

The December Australian dollar lost 56 pips on volume of 86,437 contracts. Total open interest declined just 80 contracts. The December contract accounted for loss of 189 of open interest. On Friday, the December contract made a low of 71.79 and this was taken out fractionally overnight with a new print of 71.65. However, the market has rallied strongly from the lows and trading 42 pips higher on the day.

On November 25, OIA announced that the December Australian dollar generated short and intermediate term buy signals, and the market has conformed to the typical 1-3 day pullback scenario which usually occurs after the generation of a buy signals. We are reluctant to recommend bullish positions this week because of potential chaos that could occur in the markets due to the decision by the ECB and results of the US employment report. We will monitor the Australian dollar once these reports have been released to determine whether bullish positions continue to make sense.

S&P 500 E-mini:

The December S&P 500 E-mini gained 1.80 points on volume of 660,087 contracts. Total open interest increased by 5,459 contracts, which relative to volume is approximately 55% below average. As this report is being compiled on November 30, the December contract is trading 7.75 points lower and has made a daily low of 2080.25, which takes out the November 27 print of 2081.50 and the November 25 low of 2082.25. Over the long holiday weekend, retail sales proved to be abysmal, and there is increasing concern the U.S. and global economies are slowing.

As we pointed out in the November 25 report, the E-mini has been trading weakly and has been unable to take out the major high of 2110.25 made on November 3. Additionally, there has been a pattern of fractional highs, that are followed by bouts of selling. For example, the high in today’s trading has been 2095.00, which is below the November 26 print of 2098.25.

Additionally, the December contract has been unable to make a daily low above OIA’s pivot point, which for November 30 is 2087.50. In order for the December contract to resume its advance, it must make a daily low above the pivot point.

The December contract closed at 2073.75 on October 30 and as this report is being written, the December contract is trading just 8.25 points higher for the month of November. This is an abysmal performance considering that November is traditionally one of the strongest months for equities. We will be monitoring the market carefully and looking for the most opportune time to initiate bearish positions. The December S&P 500 E-mini remains on short and intermediate term buy signals.

From the November 25 report on the December S&P 500 E mini:

“Since November 19, the E-mini has been making fractional highs, but has not been able to take out the November 3 print of 2110.25. For example, on November 19, the December contract made a high of 2089.25, which was 6.75 points above the November 18 high of 2082.50. The November 20 high of 2094.50 was 5.25 points above the 2089.25 high of November 19. The high of November 26 of 2098.25 was 3.75 points above the 2094.50 of November 20.”