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Soybeans:
August soybeans closed 1/2 cents higher on total volume of 253,724 contracts. Total open interest declined by 1,984 and open interest in the July contract declined by 11,311 on volume of 43,476 contracts. For the past three trading sessions, total open interest has declined by 8,606 contracts, and during this time, soybean prices have advanced 29.25 cents. The decline of open interest on the three day advance indicates that longs and shorts are liquidating as prices move higher. The most revealing session occurred on June 25 when soybeans advanced 40 cents to make a new high for the move at $14.91 1/4, but total open interest declined by 4,528 contracts. Tomorrow June 29, the USDA will release its acreage and quarterly stocks report. Do not enter new positions prior to the report. Readers should be consulting with their investment advisor or broker about taking full or partial profits on long positions.
Soybean meal:
August soybean meal lost 50 cents on total volume of 89,677 contracts. Total open interest declined by 4,736 and open interest in the July contract declined by 5,390 on volume of 32,303 contracts. As I have pointed out before, July soybean meal has penetrated the $434.00 level eight times, and has yet to close above it. Readers should be consulting with their investment advisor or broker about taking full or partial profits on long positions. Do not enter new positions prior to the June 29 USDA report.
Corn:
September corn closed 8 cents higher on very heavy total volume of 551,412 contracts. Total open interest declined by 861 contracts and open interest in the July contract declined by 27,043 on volume of 84,505 contracts. The September contract made a new high for the move at $6.49 1/4, however, total open interest was unable to show an increase. Corn prices have advanced during the past four trading sessions bringing the total advance to 80.75 cents, but open interest in this period has declined by 47,992 contracts. The move higher in corn has occurred due to hot and dry conditions in the corn belt. However, this is not attracting enough new participants to the market in order to offset the open interest decline in the July contract. On June 26, September corn generated an intermediate term buy signal, but in my opinion, speculators should not entering into long or short positions. The market is extremely volatile, and the open interest action is indicating that previous longs and shorts are liquidating as the market moves higher.
Wheat:
September wheat closed 4.25 cents higher on heavy total volume of 168,366 contracts. Total open interest increased by 3,898 and open interest in the July contract declined by 7,917 contracts on volume of 26,581. There were enough new entrants in the market to overcome the decline of open interest in the July contract. This was the second day in a row that open interest increased along with price, which indicates that new longs are being enticed into the market along with new shorts. I think that longs will regret buying wheat at these very lofty levels. On June 25, September wheat generated in intermediate term buy signal, but as I have said before, speculators should stand aside. If corn continues to move higher wheat will follow.
Crude oil:
August crude oil gained 85 cents on total volume of 468,779 contracts. Total open interest declined by 548 contracts. The market continues to move in a lackluster fashion and there is no reason to be involved in crude at current prices.
Gasoline:
August gasoline closed 2.40 cents lower on volume of 162,020 contracts. Total open interest declined by 9,005 contracts. Open interest in gasoline has declined for six days in a row bringing the total to 33,988 contracts. During this time frame, August gasoline has declined by 7.10 cents. Stand aside.
Copper:
July copper gained 3.65 cents on volume of 80,225 contracts. Open interest declined by 2,857 contracts. Stand aside.
Gold:
August gold gained $3.50 on light total volume of 125,201 contracts. Total open interest increased by 1,979 contracts. Please consult with your investment advisor or broker about acquiring gold at lower prices for the long-term.
Silver:
July silver lost 9.6 cents on very heavy total volume of 102,858 contracts. Total open interest declined by 2,164 contracts. Interestingly, volume on the 27th was higher than on the 26th when silver declined 48.2 cents. The market is on a short and intermediate term sell signal stand aside.
Euro:
The September Euro declined by 38 points on very light total volume of 197,940 contracts. Total open interest declined by 2,633 contracts. The market looks like it’s going to retest the 1.23 level basis September. Despite the Euro’s weakness, I am not enthusiastic about bearish positions due to the possibility of a major announcement from Europe, which could cause the Euro to rally sharply. Stand aside.
S&P 500 E mini:
The September S&P 500 E mini gained 10.00 points on volume of 1,616,884 contracts. Open interest increased by 20,791 contracts. Relative to volume, the open interest increase was somewhat better than on June 26, but it is far short of indicating enthusiasm for the upside. However, the volume on the 27th was nearly 200,000 contracts fewer than on the 26th when the S&P 500 E mini closed 9.00 points higher. During the past few days, the number of total participants has declined on upside moves, but the degree of commitment (based upon open interest increases) is modestly increasing. In my view these two offset each other, which translates to a lackluster market that has a bias to the downside. On June 25, the S&P 500 cash index generated in intermediate term sell signal after declining 19.75 points. Since that occurrence, the two-day rebound has been unimpressive. Consult your investment advisor or broker about the maintenance of long put positions.
