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July soybeans lost 10 cents on relatively light volume of 201,589 contracts. Total open interest declined by 2,687 contracts and open interest in the July contract declined by 15,561 on volume of 92,839 contracts. The old crop July versus the new crop November bull bean spread declined by 27.75 cents. On May 23, soybeans generated a short-term sell signal and is currently on a intermediate term buy signal. Stand aside.
July soybean meal lost $6.60 on total volume of 80,793 contracts. Total open interest declined by 399 contracts and open interest in the July contract declined by 9,092 on volume of 37,539 contracts. The old crop July versus the new crop December soybean meal bull spread narrowed by $6.20. Please consult with your investment advisor or broker regarding timing and entry points for long positions.
July corn lost 22 cents on volume of 334,905 contracts. The low volume was somewhat surprising considering the magnitude of the decline and that the daily trading range was 25.75 cents versus the 21 day average true range of 18.75 cents. Total open interest declined by 733 contracts and open interest in the July contract declined by 17,799 contracts on volume of 153,416 contracts. The July versus new crop December corn bull spread declined by 12 cents. Near term supplies of corn are very tight and as I write this on June 18, corn is trading 26.75 cents higher. Corn has been extremely volatile and this volatility is likely to continue into July. Stand aside.
July wheat closed 14 cents higher on relatively heavy volume of 146,458 contracts. Total open interest increased by 209 contracts and open interest in the July contract declined by 11,763 on volume of 65,148 contracts. There was a significant amount of buying in the September forward contracts to offset the massive decline in the July contract. For some strange reason, the managed money crowd is net short this market. Although wheat is on a short and intermediate term sell signal, the fact is it is trading at its longer term fair value. For example, the 206 week moving average price is $6.24. As I write this on June 18, July wheat is trading 20.75 cents higher at $6.30.75, which means it is trading only 6 cents above its 206 week moving average. This is certainly not a price level to be short, especially with potential fireworks in corn.
August crude oil gained 12 cents on light volume of 460,330 contracts. Total open interest declined by 12,476 contracts. Crude oil is acting terribly and could not even hold the rally that occurred in the overnight session. Stand aside.
August gasoline gained 2.53 cents on very light volume of 115,571 contracts. Open interest increased on the advance by 3,212 contracts. This is another member of the petroleum complex that is not acting well even though the summer driving season is upon us. Stand aside.
July copper gained 2.90 cents on volume of 69,317 contracts. Open interest declined by 1,449 contracts. I want to see a rally up to the $3.60 level before bearish positions can be implemented. Stand aside.
August gold advanced $8.50 higher on relatively light volume of 137,775 contracts. Open interest increased by 1,534 contracts. I am somewhat disappointed that gold continues to rally on light volume, and that open interest increased modestly. However, the market continues to exhibit a firm undertone. Gold is on a short-term buy signal and an intermediate term sell signal. Please consult your investment advisor or broker about acquiring gold for the long-term.
July silver closed 33.3 cents higher on light volume of 39,729 contracts. Open interest increased by 505 contracts. Like gold, volume was light and the open interest increase was modest. There is some resistance at the $29.00-$29.10 level, which the market will have to overcome, but I expect to see this shortly. Please review the Weekend Wrap on silver for June 17 and June 10.
The September Euro closed 36 points higher on light volume of 278,191 contracts. Volume was the lightest since June 5, when 265,211 contracts were traded. There is no reason to be involved in this market. Stand aside.
S&P 500 E mini:
The September S&P 500 E mini gained 11.25 points on volume of 1,892,459 contracts. Open interest declined by 95,031 contracts and the large decline can be attributed to the June contract going off the board. As I have said a couple of times before, readers should be consulting with their investment advisor or broker regarding maintaining or liquidating long put protection. As I write this on June 18, the September E mini is about unchanged on the day. Frankly, at this juncture, the market can move in either direction, and the news from Europe will be the primary driver of index prices.