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May corn closed 1 1/2 cents higher on volume of 288,575 contracts. Open interest increased by 3,650. The market made its high of $6.59 1/2 on April 2, and has not been able to surpass it since. The bull spread continued to work with May selling at a 6 cent premium to July, which is bullish. On April 10, the monthly supply and demand report will be released by the USDA. Do not enter positions prior to the report.
May soybeans closed 14 1/2 cents higher on volume of 227,096 contracts. The high of $14.34 1/4 matched the high of April 3, and beans closed at $14.34, which is the highest close to date. Do not enter positions prior to the USDA report to be released on April 10.
May sugar closed 16 points higher on heavy volume of 145,817 contracts. Open interest increased by a hefty 7,276 contracts. The unique aspect of last Thursday’s trading was that the range for the day was 38 points, however, the 21 day average true range is 58 points. Despite the narrow range, we saw very healthy volume and a sizable increase in open interest. The volume and open interest action on April 5 was similar to the action of April 4 when the market closed 17 points higher, volume was 147,019 contracts, and open interest increased by 6,769 contracts. The heavy volume and large open interest increases are telling us that there is a massive disagreement by longs and shorts regarding the direction of sugar. As I mentioned on April 4, if speculators want to initiate long positions, stops should be placed at 24.11, which was the low of March 28.
May crude oil closed $1.84 higher on light volume of 494,088 contracts. Open interest declined on the rally by 12,452 contracts. Volume on the rally was the lowest since March 30 when crude oil closed 24 cents higher and volume was 459,683 contracts. The low volume has been the big story in the crude oil market, and the lack of upside volume is clearly indicating there is a lack of enthusiasm. As I write this on April 9, crude oil is down $1.80. Crude oil is on a short-term sell signal. Stand aside.
May gasoline closed .69 cents higher on volume of 156,737 contracts. Open interest increased by 4,148 contracts. Volume was the lightest since March 27 when 146,888 contracts were traded. In the weekend wrap of April 8, I analyzed the open interest action in gasoline, and I suggest readers review it. As I write this on April 9, gasoline is down 6 1/2 cents. Stand aside.
June gold closed $16.00 higher on light volume of 143,255 contracts. Open interest declined by 5,478 contracts, which is a large number, and further confirms the weakness of the market. The light volume on the rally combined with a relatively heavy decrease in open interest on the rally is bearish. The market has been on a sell signal since March 15, however do not short this market.
May silver closed 68 cents higher on volume of 49,404 contracts. Open interest declined by 2,425 contracts. The market had a very narrow range of only 76 cents, which is significantly less than its 21 day average true range of $1.10. Similar to gold, the open interest decline was fairly large on the rally, which is bearish. In the weekend wrap of April 8, I noted that silver generated a sell signal. Stand aside.
The June euro lost 73 points on volume of 233,806 contracts. Open interest increased on the decline by a hefty 11,303 contracts. Since the market reached its most recent high of 1.3383 on March 30, open interest has increased by 28,951 contracts on the decline. The market generated a sell signal on April 4. Wait for a further rally before implementing bearish positions.
The June Australian dollar gained 35 points on volume of 109,543 contracts. Open interest declined on the rally by 362 contracts. The market is on a short-term sell signal, and it appears that a longer-term sell signal is right around the corner.
S&P 500 E mini:
The June S&P 500 E mini lost 3.00 points on volume of 1,540,585 contracts. Open interest increased on the decline by 22,115 contracts. Long put protection should be in place.
The June 10 year treasury note gained 19 points on volume of 1,134,154 contracts. Open interest increased on the advance by 10,783 contracts. Open interest has increased by over 52,000 contracts during the last two trading sessions indicating the longs are clearly in control. Stand aside. This will be the last report on interest rates until something of importance develops.