Soybeans:

May soybeans lost 2.75 cents on volume of 175,336 contracts. Open interest declined 6,815 contracts, which in relation to volume is approximately 50% above average. From March 12 through March 19, May soybeans have declined 72.75 cents while open interest has declined 19,494 contracts. This is bullish open interest action in relative to the price decline. However, on March 18, May soybeans generated a short and intermediate term sell signal. Soybeans should be traded from the short side. Due to the sharp decline during the past several sessions, and the recent generation of sell signals, soybeans are overdue for a rally. Our target for the implementation of bearish positions is $14.25-14.30.

Soybean meal: On March 19, May soybean meal generated a short and intermediate term sell signal

May soybean meal lost $1.70 on volume of 66,487 contracts. Open interest declined by a massive 4,173 contracts, which in relation to volume is approximately 140% above average, meaning that liquidation in soybean meal was very heavy. From March 12 through March 19, open interest has declined 6,831 contracts while May soybean meal has declined $26.40. This is bullish open interest action relative to the price decline. Despite this, soybean meal should be traded from the short side. Our target for the implementation of short positions is the $420.00 level.

Corn: On May corn generated an intermediate term buy signal.

May corn gained 8.50 cents on volume of 238,980 contracts. Volume was the highest since March 13 when 258,883 contracts were traded and corn closed 4 cents lower while open interest increased 5,122 contracts. On March 19, open interest increased by a staggering 22,811 contracts, which in relation to volume is approximately 265% above average, meaning that new longs were heavily entering the market and pushing prices higher. On March 14, open interest increased by 23,201 contracts while May corn advanced 6.50 cents on volume of 199,612 contracts. During the past 4 days beginning on March 14 May corn has advanced 18.50 cents while open interest has increased a total of 61,295 contracts. The massive increase in open interest confirms the uptrend and the buy signals that have been generated on March 18 and March 19. The market is overbought relative to its 50 day moving average of 7.16 on the corn continuation chart. Clients who implemented long positions when corn generated a short-term buy signal should maintain these positions.

Wheat:

May wheat gained 9.25 cents on volume of 83,726 contracts. Open interest declined 2,685 contracts, which in relation to volume is approximately 20% above average. For the past several days, open interest relative to price has been acting in a bearish congruent fashion. Despite this, clients should not implement new bearish positions and any current bearish positions should be liquidated.

Crude oil:

May crude oil lost $1.59 on fairly heavy volume of 680,198 contracts. Volume was the highest since March 13 when 723,353 contracts were traded and open interest declined by 9,519 contracts while crude oil declined 2 cents. On March 19, open interest declined 30,003 contracts, which in relation to volume is approximately 70% above average. The April contract accounted for loss of 32,450 contracts, which indicates that liquidation in the May forward contracts was minor. Crude oil made a high of $94.47, which is exactly at the 50 day moving average on the crude oil continuation chart. This was the highest price for May crude oil since February 25 when it reached $94.90. Crude oil remains on a short and intermediate term sell signal, which means that it should be traded from the short side. The 50 day moving average of 94.47 is likely to be the upper end of the trading range.

Natural gas:

May natural gas advanced 8.1 cents on volume of 437,145 contracts. Volume shrank by 43,000 contracts from March 18 when natural gas advanced 4 ticks and open interest increased by 3,890 contracts. On March 19, open interest increased by a massive 19,331 contracts, which in relation to volume is approximately 70% above average. The massive increase of open interest is more impressive considering that the April contract lost 20,027 contracts of open interest. Since March 18 through today’s session (March 20) natural gas has been unable to move beyond the $4.00 level. As we have said in prior reports, clients should take some money off the table and wait for a pullback, at which time new bullish positions can be implemented.

Copper:

May copper lost 2.25 cents on volume of 65,562 contracts. Open interest declined 2,509 contracts, which in relation to volume is approximately 50% above average. Copper remains on a short and intermediate term sell signal, and we recommend clients wait for a rally to the $3.56 area before contemplating new bearish positions.

Gold:

April gold gained $6.70 on fairly heavy volume of 207,387 contracts. Volume increased by approximately 1,700 contracts from March 18 when gold advanced $12.00 and open interest declined 3,513 contracts. On March 19, open interest declined 3,089 contracts, which in relation to volume is approximately 40% below average. During the past 4 trading sessions beginning on March 14, gold has advanced $22.90 while open interest has declined 13,771 contracts. This is bearish open interest action relative to the price advance. We are recommending a stand aside position due to the possibility of an expanding banking crisis in the peripheral countries of the euro zone.

Platinum:

April platinum lost $23.10 on heavy volume of 32,552 contracts. Volume was the highest since December 21 wind 38,006 contracts were traded and April platinum closed at $1540.90. Volume on March 19 was the 3rd highest going back to June of 2012. Open interest increased by 588 contracts, which in relation to volume is approximately 25% less than average. However, the open interest increase on March 19 was the first since March 11 when April platinum lost $2.70 and open interest increased 2 contracts. Prior to this on February 14, April platinum declined $18.80 and open interest increased by 160 contracts. On that day, April platinum closed at $1710.90. On February 7, April platinum lost $14.20 and open interest increased 859 contracts on volume of 12,868 and April platinum closed at $1722.30. In short, platinum made a new low for the move at $1549.80 on the 3rd highest volume of past 9 months while open interest increased by the 2nd highest amount since platinum topped out on February 6. To us, this indicates there is a high likelihood the low made on March 19 will hold, if only temporarily.

Australian dollar:

The June Australian dollar lost 28 points on volume of 77,952 contracts. Open interest increased by 1,556 contracts, which in relation to volume is approximately 20% less than average. On March 15, the June Australian dollar generated a short-term buy signal, but has not yet generated an intermediate term buy signal. We recommend that clients write out of the money puts on the Australian dollar.

Euro:

The June euro lost 72 points on heavy volume of 411,189 contracts. Volume was the highest since March 14 when 443,212 contracts were traded and the euro advanced 39 points while open interest increased by 1,565 contracts. On March 19, open interest increased by 6,665 contracts, which in relation to volume is approximately 35% less than average. The euro made a new low at 1.2852, which is the lowest price since late November 2012. The euro remains on a short and intermediate term sell signal, but we suggest that clients wait for a rally to the 1.31 area before contemplating bearish positions.

S&P 500 E mini:

The S&P 500 E mini lost 4.50 points on volume of 2,547,662 contracts. Open interest declined by 5,748 contracts which is minuscule and dramatically below average. Stocks trading above their 50 day moving average on the NYSE fell to 1550 from 1622 on March 18. Stocks making new highs minus stocks making new lows advanced to 322 on March 19 from 279 on March 18. As this report is being compiled, the E mini is trading 10.25 points higher. We continue to recommend the writings of calls that are significantly out of the money.