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Soybeans:

March soybeans lost 9.75 cents on volume of 179,218 contracts. Total open interest increased by 3,298 contracts, with relative the volume is approximately 25% below average. The March contract accounted for loss of 3,269 of open interest. As this report is being compiled on January 28, March soybeans are trading unchanged on the day and have made a daily low of 9.66 1/4, which is below the low of January 26 of 9.67.On January 2, March soybeans generated a short-term sell signal and has remained on an intermediate-term sell signal. We think the path of least resistance is lower.

Soybean Meal:

March soybean meal lost $2.30 on volume of 76,815 contracts. Total of interest increased by a massive 5,527 contracts, which relative to the volume is approximately 210% above average meaning that new short-sellers entered the market aggressively and drove prices fractionally lower. The March contract accounted for loss of 532 of open interest. As this report is being compiled on January 28, March soybean meal has made at daily high of 341.00, which is below yesterday’s high of 342.60. Maintain the bearish positions recommended in the January 5 report, but make sure that protective stops are in place.

Corn:

March corn lost 2.75 cents on volume of 191,862 contracts.Total open interest declined by 3,861 contracts, which relative to volume is approximately 20% below average.The March contract lost 6,819 of open interest, July 2015 -259. As this report is being compiled on January 28, March corn is trading 3.25 cents lower and has made a daily low 3.76 1/2, which is the lowest print since 3.76 made on January 14 and 15. In order for March corn to generate an intermediate term sell signal, the high of the day must be below OIA key pivot point for January 28 of 3.79 1/2. On January 14, March corn generated a short-term sell signal. We have no recommendation.

WTI crude oil:

March WTI crude oil gained $1.08 on volume of 549,719 contracts. Total open interest increased by 5,147 contracts, which relative the volume is approximately 50% below average. The March contract accounted for loss of 8.085 open interest. As this report is being compiled after the release of the EIA report, March WTI crude oil is trading 1.60 lower and has made a daily low of 44.52, which is slightly above about the contract low of 44.35 made on January 26. New contract lows are inevitable..

The Energy Information Administration announced that U.S. commercial crude oil inventories (excluding those in the Strategic Petroleum Reserve) increased by 8.9 million barrels from the previous week. At 406.7 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 2.6 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 decreased by 3.9 million barrels last week and are in the lower half of the average range for this time of year. Propane/propylene inventories fell 1.9 million barrels last week but are well above the upper limit of the average range. Total commercial petroleum inventories increased by 2.0 million barrels last week.

Natural Gas:

March natural gas advanced 8.7 cents on volume of 286,098 contract. Total open interest declined by 4,158 contracts, which relative to volume is approximately 40% below average. The February contract accounted for loss of 13,547 of open interest. As this report is being compiled on January 28, natural gas has resumed its downtrend and is trading 11.4 cents lower on the day. March natural gas remains on a short and intermediate term sell signal.Stand aside.

Gold:

April gold advanced $13.50 on very heavy volume of 285,810 contracts. Volume increased from January 26 when April gold lost 13.20 on volume of 240,271 contracts and total open interest increased by 5,443 contracts. On January 27, total open interest declined by 16,277 contracts, which relative to volume is approximately 130% above average.The February contract lost 45,409 of open interest, which explains the large total open interest decline. As this report is being compiled on January 28, April gold is trading 5.40 lower. The market remains overbought, and we expect more downside before the market makes another leg higher.

Silver:

March silver advanced 10.1 cents on volume of 37,047 contracts. Total open interest declined just eight contracts. The March contract accounted for loss of 737 of open interest. As this report is being compiled on January 28, March silver is trading unchanged on the day and has made a daily low of 17.945, which is considerably above yesterday’s low of 17.405. We see higher prices ahead, but expect a choppy affair and pullbacks are opportunities to get long.

Coffee:

March coffee advanced 6.35 cents on volume of 23,946 contracts. Total open interest increased by 1,352 contracts, which relative the volume is approximately 120% above average meaning that aggressive new buyers were entering the market and driving prices to a new high for the moves (1.6850). As this report is being compiled on January 28, March coffee is trading 70 ticks lower and has made a new high for the move at 1.6990, which is the highest print since 1.7250 made on January 20. For March coffee to generate a short-term buy signal, the low of the day must be above OIA’s key pivot point for January 28 of 1.7440. We think a short-term buy signal is not far off.

Sugar: On January 27, March sugar generated an intermediate term sell signal which reverses the intermediate term by signal of January 21.

March sugar lost 19 points on very heavy volume of 200,702 contracts. Volume was the strongest since September 12, 2014 when 265,815 contracts were traded and March sugar closed at 16.32.On January 27, total open interest increased by 7737 contracts, which relative to the volume is approximately 50% above average meaning a battle ensued between buyers and sellers and the sellers had the edge and were able to drive prices to a new low for the move (14.93). As this report is being compiled on January 28, March sugar has closed unchanged at 15.16.

Despite the move lower, March sugar remains on a short-term buy signal, which was generated on January 16. For this to reverse the high of the day must be below OIA’s  key pivot point for January 28 of 14.91.The recent downside action in sugar should be the extent of it if in fact sugar is ready to move higher. There is significant support at the 14.60 level for those clients looking at the long side of the market.