For Bloomberg access:{OIAR<GO>}

Soybeans:

January soybeans advanced 8.75 cents on volume of 226,335 contracts. Volume increased from November 5 when January soybeans advanced 9.50 cents on light volume of 183,681 contracts and total open interest increased by 1,976 contracts. On November 6, total open interest increased by 2,556 contracts, which relative to volume is approximately 50% below average. However, the November contract accounted for loss of 3,151 of open interest, January 2015 -308, Which makes the total open interest increase more impressive (bullish). November 6 was the 2nd day in a row in which prices advanced along with open interest. This is positive.

Yesterday, January beans made a high of 10.40 1/2, and as this report is being compiled on November 7, January soybeans are trading 7.75 cents higher and have made a daily high of 10.37 3/4 and a low of 10.19 1/4. Yesterday, we recommended a stand aside posture in soybeans until after the release of the November 10 USDA report. Although we think prices are ultimately headed lower, until soybeans begin to enter the pipeline, the market is vulnerable to occasional spikes on the upside.On October 24, January soybeans generated a short-term buy signal, but as yet has been unable to generate an intermediate term buy signal. We consider this to be a sign of weakness.

In order for January soybeans to continue its uptrend, the market must generate an intermediate term buy signal, and for this to occur the low the day must be above OIA’s key pivot point for November 7 of 10.45 3/4.

Soybean meal:

December soybean meal advanced $16.40 on volume of 115,912 contracts. Volume was the strongest since October 30 when December soybean meal lost 17.20 on volume of 138,052 contracts and total open interest increased by 395 contracts. Keep in mind that on October 30, December soybean meal made its high for the move at 408.50 and then promptly sold off to close at the lows of the day. On November 6, total open interest increased by a massive 5,092 contracts, which relative to volume is approximately 65% above average meaning that new longs were aggressively entering the market in heavy numbers and driving prices higher (396.80), which is the highest print since 408.50 made on October 30. As this report is being compiled on November 7, December soybean meal is trading 2.10 lower after making a daily high of 398.00. We think the high of 408.50 made on October 30 will be the high for the move. December soybean meal remains on a short and intermediate term buy signal. We have no recommendation.

Soybean oil: This will be our last report on soybean oil until we see a trading opportunity or signal change.

December soybean oil lost 19 points on volume of 120,663 contracts. Total open interest declined by 2,028 contracts, which relative to volume is approximately 35% less than average. The December contract accounted for loss of 6,312 of open interest. As this report is being compiled on November 7, December soybean oil is trading 2 points lower and has made a daily low with 32.27, which takes out the previous low of 32.32 made on November 5. December soybean oil remains on a short-term buy signal, but an intermediate term sell signal. Stand aside.

Corn:

December corn advanced 1.00 cent on volume of 293,378 contracts. Volume fell from November 5 when December corn advanced 5.75 cents on volume of 343,735 contracts and total open interest increased by a massive 15,049 contracts. Additionally, volume was lower than the trading activity on November 4 when December corn lost 9.00 cents on volume of 299,948 contracts and total open interest increased by 6,080 contracts. On November 6, total open interest declined by 784 contracts, which is minuscule and dramatically below average. The December contract accounted for loss of 17,515 of open interest.Yesterday, December corn made a high of 3.74 1/2, which was the highest print since 3.75 1/4 made on November 3.

As this report is being compiled on November 7, December corn is trading 2.25 cents lower and has made a daily low of 3.64 1/4, which is the lowest print since 3.59 made on November 5. December corn generated a short-term buy signal on October 9 and an intermediate term buy signal on October 30. We think the high of 3.81 made on October 30 will be the high for the move, and if we are wrong, the next point of resistance would be OIA’s key pivot point for November 7 of 3.93 1/8.We have no recommendation.

Chicago wheat:

December Chicago wheat lost 4.50 cents on volume of 81,458 contracts. Total open interest increased by 1,447 contracts, which relative to volume is approximately 25% below average.However, the December contract accounted for loss of 3249, which makes the total open interest increase more impressive (bearish).As this report is being compiled on November 7, the December contract is trading 6.75 cents lower and has made a daily low of 5.11. On October 17, December Chicago wheat generated a short-term buy signal and has been unable to generate an intermediate term buy signal, which is a testament to the weakness of the market.We think a short-term sell signal is imminent and for it to be generated, the high of the day must be below OIA’s key pivot point for November 7 of 5.14.

If bearish positions have been initiated during the past couple of days, and the position is profitable, we think it is safe to hold it through the was the USDA report on Monday. However, make sure that appropriate stops are in place. If not involved, wait until after the report.

WTI crude oil:

December WTI crude oil lost 77 cents on light volume of 536,505 contracts. Volume was the weakest since October 21 when December WTI lost 58 cents on volume of 516,555 contracts and total open interest increased by 6,102 contracts. On November 6, total open interest declined just 204 contracts. The December contract accounted for loss of 14,858, which makes the minor open interest decline bearish in our view. In other words, there were sufficient increases of open interest in the forward months on the price decline to offset most of the loss in the December contract. As this report is being compiled on November 7, December WTI is trading $1.12 higher and has made a daily high of 79.41, which is slightly above the daily high of 79.35 made on November 5. Stand aside.

Natural gas: Natural gas is trading based upon anticipated weather patterns, and this is the most dangerous kind of market to trade. Do not enter new long positions. If long from lower levels, use stops based upon sound money management.

December natural gas advanced sharply on November 6, gaining 21 cents on extraordinarily huge volume of 646,234 contracts.Volume traded exceeded that of February 19, 2014 when 621,768 contracts were traded and December natural gas closed at 4.892. Additionally volume was the highest since January 24, 2014 when 711,753 contracts were traded and December natural gas closed at 4.489.

On November 6, total open interest increased by a spectacular 30,084 contracts, which relative to volume is approximately 75% above average meaning that huge numbers of new longs were rushing into the market and driving prices to a new high for the move (4.457), which is the highest print since 4.493 made on July 3, 2014. As this report is being compiled on November 7, December natural gas is trading 3.9 cents higher and has made a daily high of 4.494, slightly above the July 3 high.

Huge spikes in volume and open interest can very often signal a top or temporary top. We are not saying this is the end of the move, only that it is becoming very dangerous to be on the long side of the market unless long from significantly lower levels. We think the market has gotten ahead of itself and is massively overbought based upon the anticipated cold snap next week. If this forecast diminishes in intensity, the market will fall and likely fall sharply. Bull spreads are widening significantly and volatility is high, which makes trading options very expensive. If not long from significantly lower levels, stand aside. On November 3, OIA announced that December natural gas generated a short-term buy signal and on November 5, announced it had generated an intermediate term buy signal.

Coffee:

December coffee lost 2.50 cents on volume of 27,798 contracts. Total open interest increased by 457 contracts, which relative to volume is approximately 35% below average, however the December contract lost 1,838 of open interest, which makes the total open interest increase more impressive (bearish). It should be notedt this is the 1st open interest increase on a price decline that we have seen since December coffee topped on October 14 when December coffee made its high close of 2.2190.

It appears the Johnny-come-lately crowd is getting bearish at the low-end of the trading range, which may be good news because it may signal that coffee is getting closer to a bottom. The next area of support is 1.7640, the lows made on September 19 and 22. Yesterday, the July 2015-March 2016 spread lost 40 ticks to close at 3.05 cents premium to March 2016. As this report is being compiled on November 7, December coffee has closed at 1.8240, down 1.35. This is the lowest close since September 25 (1.8230). As we have said before, clients should exit the long July 2015-short March 2016 spread at 3.10 cents premium to March 2016.