For Bloomberg access:{OIAR<GO>}

Due to the Columbus Day holiday, the USDA will release its export sales report tomorrow.

Soybeans:

November soybeans lost 12.25 cents on total volume of 336,580 contracts. Volume declined substantially from October 14 when November beans advanced 19.50 cents on volume of 402,225 contracts and total open interest declined by 9,432 contracts. On October 15, total open interest declined by 2,336 contracts, which relative to volume is approximately 65% below average. The November contract accounted for loss of 13,724 of open interest. Yesterday, November soybeans made a high of 9.78 1/2, which is the highest print since 9.86 1/2 made on September 18. As this report is being compiled on October 16, November soybeans are trading 9.00 cents higher, but has not taken out yesterday’s high.In order for January 2015 soybeans to generate a short-term buy signal, the low the day must be above OIA’s key pivot point of 9.77 3/4. Stand aside.

Soybean meal: December soybean meal will generate a short-term buy signal on October 16, but remains on an intermediate term sell signal.

December soybean meal advanced $3.30 on volume of 107,745 contracts. Total open interest increased by 2,251 contracts, which relative to volume is approximately 20% below average, However the December contract lost 2,085 of open interest, which makes the total open interest increase more impressive (bullish).The strength in soybean meal has been impressive along with increases of open interest on price advances. After generating a short-term buy signal, the market has a tendency to pullback from 1-3 days and this is the opportunity to enter bullish positions. As this report is being compiled on October 16, December soybean meal is trading $6.10 higher and has made a new high for the move at 335.20, which is above the 50 day moving average of 330.00. Stand aside until the market pulls back.

Soybean oil:

December soybean oil lost 89 points on volume of 104,419 contracts. Total open interest declined by 1,269 contracts, which relative to volume is approximately 45% below average.The December contract accounted for a loss of 5,259 of open interest. Yesterday, the May 2015-December 2015 spread narrowed by 6 points.Maintain the long May 2015-short December 2015 futures spread, but exit the position upon the penetration of the September 26 low of 16 points premium to December 2015. After showing considerable strength, the palm oil market has been weakening after topping out on September 30.

Chicago wheat:

December Chicago wheat lost 3.25 cents on volume of 78,821 contracts. Total open interest declined by 4,103 contracts, which relative to volume is approximately 105% above average meaning that liquidation was extremely heavy on the modest decline. The December contract accounted for loss of 4,181 of open interest. As this report is being compiled on October 16, December Chicago wheat is trading 8.75 higher and has made a daily high of 5.16 3/4, which is one half cent above yesterday’s high (5.16 1/4). In order for December Chicago wheat to generate a short-term buy signal, the low the day must be above OIA’s key pivot point for October 16 of 5.11 5/8. Stand aside.

Lean hogs: On October 15, December hogs generated a short-term sell signal and has been on an intermediate term sell signal since September 17.

December lean hogs lost the 3.00 cent daily limit on very light volume of 25,573 contracts. Total open interest increased by 715 contracts, which relative to volume is average. The December contract accounted for loss of 1,207 of open interest, which makes the total open interest increase on yesterday sharp decline more impressive (bearish). As this report is being compiled on October 16, December lean hogs are trading 1.775 cents lower on the day. Stand aside.

WTI crude oil:

November WTI crude oil lost 6 cents on very heavy volume of 1,100,618 contracts. Volume fell slightly from October 14 when November WTI lost $3.90 on volume of 1,102,302 contracts and total open interest increased by 21,320 contracts.On October 15, total open interest increased by 8,436 contracts, which relative to volume is approximately 60% below average. The November contract accounted for loss of 13,411 of open interest, which makes the minor increase of total open interest that much more impressive (bearish). Yesterday, the market made a new contract low at 80.01, and as this report is being compiled on October 16 has made another contract low at 79.78, which is the lowest print since June 2012 (77.28).However, after making a new contract low on October 16 , November WTI is rallying, up 62 cents, which is overdue considering the massive oversold condition of the market. Stand aside.

Brent crude oil:

December Brent crude oil lost $1.29 on heavy volume of 1,045,533 contracts.Volume was the strongest since October 14 when 1,094,464 contracts changed hands and December Brent lost $4.00.The volume on the past 2 days has been the highest since July 15 when 1,490,765 contracts were traded and December Brent crude oil closed at $107.33. On October 15, total open interest declined by 15,455 contracts, which relative to volume is approximately 40% less than average. The November contract accounted for loss of 25,332 of open interest and there were insufficient open interest increases in the forward months to offset the decline in November. According to relative strength readings going back to 1988, yesterday was the most oversold day of the past 26 years. On October 15, December Brent made a low of 83.73, and as this report is being compiled on October 16 has made another new low at 82.93 , which is the lowest print since November 2010 when December 2010 Brent crude oil made a low of 82.43. Although, the market is massively oversold and due for a counter trend rally, the trend is down in the months ahead. Stand aside.

Natural gas: Liquidate the long February 2015-short May 2015 natural gas futures spread.

November natural gas lost 1.6 cents on volume of 239,691 contracts. Total open interest declined by 5,061 contracts, which relative to volume is approximately 15% below average. The November contract accounted for loss of 14,882 of open interest. Yesterday, November natural gas made a new low for the move at $3.764 , which took out the previous low of 3.786 made on July 28. As this report is being compiled on October 16 after the release of the EIA report, November natural gas is trading 3.2 cents lower and has made another new low of 3.744.On October 10, November natural gas generated a short-term sell signal and remains on an intermediate term sell signal as well.The February 2015-May 2015 bull spread has narrowed by another 1.8 cents on October 16, which is below the September 23 low of 26.9 cents premium to February 2015. The spread should be liquidated.

The Energy Information Administration announced that working gas in storage was 3,299 Bcf as of Friday, October 10, 2014, according to EIA estimates. This represents a net increase of 94 Bcf from the previous week. Stocks were 344 Bcf less than last year at this time and 362 Bcf below the 5-year average of 3,661 Bcf. In the East Region, stocks were 151 Bcf below the 5-year average following net injections of 49 Bcf. Stocks in the Producing Region were 173 Bcf below the 5-year average of 1,173 Bcf after a net injection of 35 Bcf. Stocks in the West Region were 37 Bcf below the 5-year average after a net addition of 10 Bcf. At 3,299 Bcf, total working gas is below the 5-year historical range.

10 Treasury Note: On October 8, 2014 OIA announced that the December 10 year Treasury Note generated a short and intermediate term buy signal.

December 10 year treasury note advanced 1.04 points on extremely heavy volume of 4,101,918 contracts. Volume traded was the highest of 2014. Remarkably, total open interest increased only 1,604 contracts.It appears that previous holders of long and short positions were being replaced by new longs and shorts, which explains essentially unchanged open interest.The December contract skyrocketed to a new contract high of 130-170 , which is the highest print since the week of June 17, 2013 (130-250). Stand aside.

Dollar index: On July 16, 2014 the September dollar index generated a short and intermediate term buy signal.

The December dollar index lost 70 points on extremely heavy volume of 118,291 contracts.Volume traded was the highest of 2014. On October 15, total open interest declined by 5,446 contracts, which relative to volume is approximately 75% above average meaning that liquidation was extremely heavy on the decline. The December contract made a new low for the move at 84.525, which is the lowest print since 84.460 made on September 23. Remarkably, the dollar index has not generated a short term sell signal. For this to occur, the high of the day must be below OIA’s key pivot point for October 16 of 84.841. We expect a further setback in the dollar index, will be looking eventually to position clients on the long side of the market.

Euro:

The December euro advanced 1.27 cents on huge volume of 565,400 contracts. Volume was the strongest since September 10 when 558,787 contracts were traded and the December euro lost 13 pips.On October 15, total open interest declined only 4,694 contracts, which relative to volume is approximately 60% below average. Considering the magnitude of the advance and the move to a new high (1.2893), the open interest decline is underwhelming. This means there are large numbers of speculative shorts remaining in the market, who will be forced to cover as prices continue their advance. In order for the December euro to generate a short-term buy signal, the low the day must be above OIA’s key pivot point for October 16 of 1.2843. Stand aside.

Yen: On October 14, the December yen generated a short-term sell signal, but remains on an intermediate term sell signal.

December yen advanced 82 pips on heavy volume of 435,124 contracts.Volume traded on October 15 was the highest of 2014. On October 15, total open interest declined by 4756 contracts, which relative to volume is approximately 50% below average.For the yen to continue its advance, it must make a daily low above OIA’s key pivot point for October 16 of .9467. Failure to do so will likely result in the yen is trading sideways to lower. Stand aside.

Gold: For December gold to generate a short-term buy signal, the low the day must be above OIA’s key pivot point for October 16 of 1236.90.

December gold advanced $10.50 on extremely heavy volume of 272,753 contracts.Volume was the strongest since July 29, 2014 when 354,499 contracts were traded and August gold closed at 1298.30. On October 15, total open interest increased by 5,016 contracts, which relative to volume is approximately 25% below average, but the impressive volume and increase of open interest on the relatively modest advance is one of the best showings for gold in quite some time. As this report is being compiled on October 16, December gold has closed $3.60 lower at 1241.20. Stand aside.

Cocoa:

December cocoa advanced $43.00 on volume of 25,389 contracts. Volume increased from October 14 when December cocoa advanced 43.00 on volume of 22,523 contracts and total open interest declined by 1,238 contracts. On October 15, total open interest increased only 127 contracts, which relative to volume is approximately 75% below average. However, the December contract lost 534 of open interest, March 2015 -100, which makes the total open interest increase more impressive (bullish).

Yesterday, the March 2015-December 2015 spread widened by 19.00. However, on October 16, December cocoa is trading 79.00 lower and the March 2015-December 2015 spread has narrowed by 21.00 and trading at a 62.00 premium to March 2015.  If the spread penetrates the October 7 low of 46.00, we would abandon the position.  Although we think higher prices are ahead, the fact remains that December cocoa remains on a short and intermediate term sell signal, which means lower prices are likely in the short-term.

Coffee:

December coffee lost 5.90 cents on volume of 22,970 contracts. Total open interest declined by 238 contracts, which relative to volume is approximately 50% below average. The December contract accounted for loss of 664 of open interest. Yesterday, the long July 2015-short March 2016 spread narrowed by 55 points. As this report is being compiled on October 16, December coffee has closed at 2.1710, up 1.10 cents and the July 2015- March 2016 spread has narrowed by 25 points. Continue to hold the spread because we think coffee prices are headed significantly higher. The market is consolidating and therefore lower prices cannot be ruled out in the short-term. This will continue to narrow the spread.