Soybeans:

March soybeans lost 10.25 cents on volume of 240,561 contracts. Open interest increased by 6,686 contracts, which in relation to volume is average. The March contract lost 6,738 contracts of open interest. From January 18 through January 31, open interest has increased by 57,470 contracts while March soybeans have gained 38.25 cents. Soybeans made a new high for the move at $14.84 1/4, which is the highest price since December 18 when March beans made a high of $14.93 3/4. As this report is being compiled, soybeans are trading 13.25 cents higher and have made a new high for the move at 14.86 1/2. March soybeans are on a short-term buy signal, but an intermediate term buy signal has not been generated. Soybeans look to move higher in the days ahead.

Soybean meal:

March soybean meal lost $6.30 on volume of 66,516 contracts. Open interest declined by 280 contracts, which is minuscule and dramatically below average. From January 14 through January 31, open interest has increased by 43,020 contracts while March meal has advanced $22.10. Like soybeans, soybean meal has seen massive increases of open interest, yet prices have moved higher at a slow pace. If the low of $425.40 for the March contract holds on February 1, a short-term buy signal will be generated. Soybean meal has been the laggard of the bean complex.

Soybean oil:

March soybean oil gained 26 points on volume of 84,271 contracts. Open interest declined by 87 contracts, which is minuscule and dramatically below average. March soybean oil made a new high of 52.96, which is the highest price for this contract since October 25 when the March contract made a high of 53.03. As this report is being compiled on February 1, March soybean oil has reached another new high of 53.57. It is highly likely that March soybean oil will generate an intermediate term buy signal on February 1.

Corn:

March corn gained 0.25 cents on volume of 319,262 contracts. Volume was the highest since January 15 when 321,861 contracts were traded and March corn closed at $7.30 1/2. On January 31, open interest increased by 29,973 contracts, which in relation to volume is approximately 265% above average, meaning that new longs and shorts were aggressively taking new positions, but could not move the market much beyond unchanged. During the past couple of reports, we have commented on the massive build of open interest, which has not moved corn, soybeans and soybean meal significantly higher. We have attributed this to heavy commercial selling.

Wheat:

March wheat lost 7.50 cents on volume of 110,363 contracts. Open interest increased by 1,998 contracts, which in relation to volume is approximately 10% below average. As this report is being compiled on February 1, March wheat is trading 13.00 cents lower. Stand aside.

Crude oil:

March crude oil lost 45 cents on volume of 672,684 contracts. Open interest increased by 3,980 contracts, which in relation to volume is approximately 75% below average. On January 31, the 50 day moving average crossed above the 200 day moving average. This is a bullish development, but as we have said before, crude oil is massively overbought and we think that clients should stand aside.

Copper:

March copper lost 1.80 cents on huge volume of 89,122 contracts. Volume was the highest since November 27 when 97,007 contracts were traded and March copper closed at $3.5510. As this report is being compiled, copper is trading 4.95 cents higher. Copper remains on a short and intermediate term buy signal. For copper to break out of its trading range, it has to move decisively above $3.84.

Gold:

April gold lost $17.90 on volume of 181,408 contracts. Open interest declined by 6,987 contracts, which in relation to volume is approximately 50% above average, meaning that liquidation was fairly heavy. On January 30, gold advanced $18.90, but open interest increased by only 419 contracts. In short we saw a dramatic drop of open interest on the price decline compared to the open interest advance on January 30. As this report is being compiled, gold is trading $7.60 higher. Gold remains on a short and intermediate term sell signal.

Platinum:

April platinum lost $13.90 on volume of 10,293 contracts. Open interest increased by 571 contracts, which in relation to volume is approximately 120% above average. The market remains overbought and we advised clients to stand aside.

Silver:

March silver lost 82.6 cents on volume of 62,151 contracts. Volume declined from the 64,173 contracts that were traded on January 30 when March silver advanced 99.3 cents and open interest increased by 3,148 contracts. On January 31, open interest declined by 1826 contracts, which in relation to volume is approximately 20% above average. It is positive to see that open interest increased dramatically on the advance on January 30, but had a muted declined on January 31 when prices took a dive. As this report is being compiled, March silver is trading 58.9 cents higher. During the last 3 days, silver trading has been hazardous to one’s financial health due to the whipsaw action. Silver remains on a short-term buy signal, but an intermediate term sell signal.

Euro:

The March euro gained 8 points on volume of 241,000 contracts. Open interest increased by 2,326 contracts, which in relation to volume is approximately 50% less than average. As this report is being compiled on February 1, the euro has made a new high at 1.3715 and is currently trading 91 points higher on heavy volume. One data point that clients should be aware of is a huge increase of open interest relative to volume on the rally, which may signal a temporary top.

S&P 500 E mini:

The S&P 500 E mini lost 2.00 point on volume of 1,643,050 contracts. Open interest increased by 4,842 contracts which is minuscule and dramatically below average. As this report is being compiled, the E mini has made a new high at 1510.50 and is currently trading 14.75 points higher. We continue to advise clients not to enter new long positions in the E mini at current levels because the market is massively overbought.