Soybeans: On March 18, May soybeans generated a short and intermediate term sell signal.

May soybeans lost 16.50 cents on volume of 200,300 contracts. Volume exceeded the trading on March 8 when 199,125 contracts were traded and open interest increased 6,779 contracts while May soybeans lost 2.50 cents. On March 18, open interest declined 6,462 contracts, which in relation to volume is approximately 25% above average. Rallies to the $14.25-14.30 area should be the target for the implementation of bearish positions.

Soybean meal:

May soybean meal lost $5.50 on volume of 69,486 contracts. Volume declined approximately 2,000 contracts from March 15 when soybean meal lost $6.20 and open interest declined 3,771 contracts. On March 18, open interest declined 1,871 contracts, which in relation to volume is average. Soybean meal has not generated a short or intermediate term sell signal as yet, but this should occur tomorrow.

Soybean oil: We will commence reporting on soybean oil when we see a trading opportunity.

Corn: On March 18, May corn generated a short-term buy signal.

May corn gained 3 cents on volume of 167,464 contracts. Open interest increased by a massive 8,801 contracts, which in relation to volume is approximately 105% above average, meaning that new longs were entering the market and driving prices higher. Corn closed at $7.20, which is the highest close since February 6 (7.24). As this report is being compiled, corn is trading 7 cents higher and has made a new high for the move at $7.28 1/4. On the corn continuation chart, the 200 day moving average is $7.27 1/2 while the 50 day is 7.09 3/4. On the May chart the 200 day moving average is $7.21 1/2 and the 50 day is 7.09 3/8. On March 18, corn closed at a premium of 7 1/4 cents to wheat. The high for the spread was 11.25 cents on March 11. We expect a pullback now that the buy signal has been generated. This should be used to implement bullish positions. It is likely that corn will generate in intermediate term buy signal on March 21.

Wheat:

May wheat lost 10.25 cents on volume of 87,578 contracts. Interestingly, volume on March 15 of 99,631 contracts occurred when the daily range was 7 3/4 cents and May wheat closed 1.75 cents lower. On March 18, wheat traded in a 16 cent range, and closed sharply lower, yet the volume shrank approximately 12,000 contracts from March 15. In short, it is possible the downside in wheat is in and that it will trade sideways to irregularly higher. Wheat remains on a short and intermediate term sell signal. Stand aside

Crude Oil:

May crude oil gained 29 cents on volume of 489,414 contracts. Open interest declined 3,700 contracts, which in relation to volume is approximately 70% less than average. During the past 3 days, crude oil has advanced $1.22 while open interest has declined 33,111 contracts. This is bearish open interest action relative to the price advance. In yesterday’s report, we commented that the overall decline of open interest was due to the expiration of the April contract. However, in the case of natural gas, the April contract is expiring as well, but for the past 3 days, open interest has increased each day. Another potential sign of weakness, is average daily volume for the past 3 days has been 474,537 contracts on 3 days of increasing prices. This is dramatically below the average daily volume for February of 607,384 contracts and the year to date average daily volume of 589,197 contracts. Another negative, is the weakness of Brent crude versus West Texas intermediate crude. As this report is being compiled, West Texas intermediate is trading $1.42 lower and Brent crude is trading $2.12 lower. Crude oil should be traded from the short side.

Natural gas:

May natural gas closed 4 ticks higher on fairly heavy volume of 480,097 contracts. Open interest increased 3,890 contracts, which in relation to volume is approximately 60% below average. The market has a very firm undertone, and it appears that natural gas wants to go higher. Although the petroleum complex is down sharply along with equities, natural gas is trading 6.6 cents higher. Despite this, we think it is wise to take some money off the table. When the market pulls back, clients will have an opportunity to implement new bullish positions, for a retest of the highs.

Copper:

May copper lost 9.25 cents on volume of 87,703 contracts. Volume was the highest since February 26 when 112,265 contracts were traded and May copper closed at $3.5830. On March 18, May copper made a new low for the move at $3.4100, which broke the November 9, 2012 low of 3.4140. As this report is being compiled, copper is made another new low at 3.3880 and is trading down 3.20 cents. On February 21, copper generated a short and intermediate term sell signal. We had recommended the implementation of bearish positions on rallies to the 3.60 area, but the market was unable to move to that level.

Gold:

April gold advanced $12.00 on fairly heavy volume of 205,678 contracts. Volume was the highest since March 8 when 248,165 contracts were traded and April gold advanced $1.80 after making a new low for the move at $1560.40 while open interest increased 2,896 contracts. On March 18, open interest declined by 3,513 contracts, which in relation to volume is approximately 25% less than average. As this report is being compiled, gold is trading $7.10 higher and has made a new high for the move at 1615.00. Stand aside.

Platinum:

April platinum lost $12.10 on volume of 16,270 contracts. Open interest declined by 241 contracts, which in relation to volume is approximately 40% less than average. As this report is being compiled, April platinum is trading $23.80 lower and has made a new low for the move at $1549.80 on very heavy volume. April platinum generated a short-term sell signal on February 22 and an intermediate term sell signal on February 28. Stand aside.

Silver:

May silver gained 2.3 cents on volume of 38,870 contracts. Open interest declined 613 contracts, which in relation to volume is approximately 40% less than average. Stand aside.

Australian dollar:

The Australian dollar lost 8 points on volume of 88,132 contracts. Open interest increased 5,044 contracts, which in relation to volume is approximately 120% above average, meaning that neither long nor shorts were able to move prices significantly one way or the other. On March 18, the Australian dollar made a low of 1.0273, which held throughout the evening and during the remainder of the day session. This occurred when the euro and most markets fell sharply lower. Thus far on March 19, the low has been 1.0281. On March 15, the June Australian dollar generated a short-term buy signal. And intermediate term buy signal has not been generated. After a buy signal is generated, we expect to see a pullback, and this would be an opportunity to implement bullish positions. We have suggested that a conservative way of trading the Australian dollar would be to write out of the money puts.

Euro:

The June euro lost 1.06 cents on volume of 356,121 contracts. Volume exceeded the year to date volume of 294,112 contracts and the February volume of 320,470 contracts. On March 18, open interest increased by a massive 12,183 contracts, which in relation to volume is approximately 40% above average. On February 26, the euro generated a short-term sell signal and an intermediate term sell signal on March 4. As this report is being compiled, the June euro is made a new low at 1.2852, and is currently trading 79 points lower. The euro never rallied up to our target of 1.3200 to implement bearish positions. With a lot of emotion in the market, and the possibility of a shift in market sentiment, we suggest a stand aside position.

S&P 500 E mini:

The S&P 500 E mini lost 6.75 points on volume of 2,194,575 contracts. Open interest declined by 928,130 contracts, which was due to the expiration of the March contract. Stocks trading above their 50 day moving average on the NYSE fell to 1622 from 1679 on March 15. The number of stocks making new highs minus stocks making new lows fell to 279 from 749 on March 15. In the past, we have pointed out that the number of stocks making new highs minus stocks making new lows peaked on January 2. Additionally, the number of stocks trading above their 50 day moving average on the NYSE peaked on January 22. We continue to recommend writing calls that are significantly out of the money.