WTI crude oil:
August WTI crude oil lost $1.94 on heavy volume of 1,707,202 contracts. Total open interest declined by 22,765 contracts, which relative to volume is approximately 45% below average. The August contract accounted for a loss of 22,749 of open interest.
As this report is being compiled after the release of the EIA storage report, which indicated that inventory declined by 6.3 million barrels, the August contract is trading up $1.11 or +2.48%. On July 3, OIA announced that August and September WTI crude oil generated short term buy signals, but both contracts remain on immediate term sell signals. We have no recommendation.
The Energy Information Administration announced that U.S. commercial crude oil inventories (excluding those in the Strategic Petroleum Reserve) decreased by 6.3 million barrels from the previous week. At 502.9 million barrels, U.S. crude oil inventories are in the upper half of the average range for this time of year. Total motor gasoline inventories decreased by 3.7 million barrels last week, but are near the upper limit of the average range. Both finished gasoline inventories and blending components inventories decreased last week. Distillate fuel inventories decreased by 1.9 million barrels last week but are above the upper limit of the average range for this time of year. Propane/propylene inventories increased by 2.1 million barrels last week but are in the lower half of the average range. Total commercial petroleum inventories decreased by 13.4 million barrels last week.
Natural Gas: On July 6, August and September gas will generate short term sell signals. Both contracts remain on intermediate term sell signals.
Yesterday, August natural gas lost 11.1 cents on elevated volume of 508,777 contracts. Total open interest increased by 10,695 contracts, which indicates that new short-sellers were entering the market in substantial numbers and driving prices to a new low for the move of 2.832. On the continuation chart, this is the lowest print since 2.833 made by the April 2017 contract on March 8, 2017.
The total open interest increase relative to volume is approximately 10% below average and the August contract gained 17,099 of open interest. As this report is being compiled on July 6. the August contract is trading 3.9 cents above yesterday’s close. Last week, we recommended liquidating bullish positions because we anticipated the reversal of the buy signal of June 28. Stand aside.
Soybeans: On July 5, August and November 2017 soybeans generated intermediate term buy signals after generating short term buy signals on July 3.
August soybeans advanced 11.75 cents on volume of 347,342 contracts. Total open interest increased by 1,327 contracts, which relative to volume is approximately 80% below average. The July contract lost 713 of open interest and August 2017 -5,968, which means there were sufficient open interest increases in the forward months to offset the decline in both delivery months and increase total open interest fractionally. We have no strong opinion about soybeans as they enter the growing season. Anything can happen weather wise. Stand aside.
Corn: On July 5, September 2017 corn generated short and intermediate term buy signals.
September corn gained 3.50 cents on volume of 494,510 and contracts. Total open interest 7,366 contracts, which relative to volume is approximately 40% below average, but a total open interest increase on yesterday’s advance is positive. The July contract accounted for a loss of 1,675 of open interest. As this report is being compiled on July 6, the September contract is trading fractionally lower and has not taken out yesterday’s high of 3.94 1/4. Stand aside.
Mexican Peso: The September Mexican Peso will generate a short term sell signal on July 6 if the daily high remains below OIA’s key pivot point for July 6 of .05430.