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Soybeans:

July soybeans gained 4 cents on fairly light volume of 202,536 contracts. Total open interest increased by 1,264 contracts and open interest in the July contract declined by 23,056 on volume of 64,024 contracts. Although the volume was unimpressive, there was enough buying in the back months to overcome the open interest in decline in the July contract. The market is on a short and intermediate term buy signal, and as I write this on June 25, July soybeans are 38.75 cents higher on the day. There is more turmoil coming from Europe, which is pushing down equity and crude oil prices and so far it is not affecting soybeans and other grains. Soybeans and the other grains are responding to increasingly dry conditions in the corn and soybean growing areas of the U.S. Please consult with your investment advisor or broker regarding entry points and timing and stop placement for long positions.

Soybean meal:

July soybean meal lost $7.00 on heavy volume of 119,019 contracts. Open interest increased by 6,066 contracts and open interest in the July contract declined by 9,130 on volume of 40,574 contracts. I was greatly concerned by the heavy selling that occurred in the last hour of trading and that open interest increased on the decline. Very possibly, the decline in soybean meal can be attributed to what is known as a crush spread trading. This occurs when grain companies buy soybeans and sell the products (soybean meal and soybean oil). As I indicated in the June 24 Weekend Wrap, my concern about soybean meal is that the market hasn’t been able to close above the $434.00 level since before May 2. In my view, it is very important for July soybean meal to close above this. As I write this on June 25, July soybean meal is $8.90 higher. Although the impact has not been felt today, events out of Europe could at some point negatively affect the direction of soybean meal. Readers should be consulting with their investment advisor or broker regarding entry points timing and stop placement for long positions.

Corn:

July corn closed 4.50 cents higher on volume of 340,653 contracts. Total open interest declined by 22,632 contracts and open interest in the July contract declined by 35,802 on volume of 110,744 contracts. During the past 12 trading sessions, open interest has declined in every session with the exception of one, which occurred on June 20. As I write this on June 25, July corn is 30.25 cents higher on continued dry conditions in the corn belt. There are a significant number of speculative shorts in the corn market and this is undoubtedly propelling the market higher. Stand aside.

Wheat:

July wheat gained 11.50 cents on relatively heavy volume of 145,421 contracts. Total open interest declined by 5,134 and open interest in the July contract declined by 11,920 contracts on volume of 58,722. On June 19, July wheat generated a short-term buy signal. As I write this on June 25, July wheat is 37.75 cents higher and if today’s low of $6.82, an intermediate term buy signal will be generated. Wheat is loaded with speculative shorts and therefore is difficult to determine how high the rally goes. However, this market is massively overbought and readers should not even think of entering long positions at these lofty levels. Stand aside.

Crude oil:

August crude oil closed $1.56 higher on light volume of 512,831 contracts. Open interest declined by 4,860 contracts. The market continues to look terrible and as I write this on June 25, August crude is down $1.36. Stand aside.

Gasoline:

August gasoline advanced 1.56 cents on volume of 157,000 contracts. Open interest declined by 4,277 contracts. As I write this on June 25, gasoline is 1.05 cents higher. Stand aside.

Copper:

July copper closed fractionally higher on volume of 72,451 contracts. The market made a new low for the move at $3.2565. Stand aside.

Gold: On June 22 August gold generated a short-term sell signal.

August gold closed $1.40 higher on volume of 129,124 contracts. Open interest declined by 3,895 contracts and on June 22, a short-term sell signal was generated, which reversed the June 6 short-term buy signal. Gold remains on an intermediate term sell signal. As I write this on June 25, August gold is $20.10 higher. Please see commentary in the June 24 Weekend Wrap on gold. Readers should be consulting with their investment advisor or broker regarding the accumulation of gold at lower prices to be held for the long term.

Silver:

July silver closed 17.8 cents lower on relatively heavy volume of 72,064 contracts. Open interest increased by 416 contracts. Last week, silver underwent a major correction and much damage has been done to the chart. Please review the June 24 Weekend Wrap for more on silver. The market remains on a short and intermediate term sell signal. Stand aside.

Euro:

The September Euro closed essentially unchanged on volume of 251,753 contracts. Open interest declined by 3,383 contracts. As I write this on June 25 the September Euro is down 62 points. Stand aside.

S&P 500 E mini:

The S&P 500 E mini gained 8.50 points on volume of 1,860,749 contracts. Open interest increased by 3,184 contracts. In relation to volume, I consider this to be essentially an unchanged number, and I suspect that much of the activity involved old shorts and longs  being replaced by new shorts and longs. As I write this on June 25, the September S&P 500 E mini is down 22.75 points on more troubles from Europe. As indicated in the June 24 Weekend Wrap, the market is on a short and intermediate term buy signal, but it is likely an intermediate term sell signal will be generated on June 25 in the S&P 500 cash index. However, a short-term sell signal will not be generated on the 25th. Readers should be consulting with their investment advisor or broker regarding the maintenance of put protection.