July soybeans closed 4 1/4 cents higher on volume of 282,645 contracts. Open interest declined by 12,873 contracts. This is the biggest decline in open interest in quite a while. For the first time, May soybeans sold at a 1 cent premium to July. Stand aside
July corn closed 6 1/2 cents higher on heavier than normal volume of 387,114 contracts. Open interest declined by a whopping 15,338 contracts. During the past five trading sessions, open interest has declined by a total of 79,000 contracts. The May-July corn bull spread increased by 6 1/2 cents with May selling at a 16 1/2 cent premium to July. The situation in corn is becoming more bullish as tired longs liquidate their positions. Stand aside.
June crude oil closed $.43 higher on light volume of 417,413 contracts. Open interest increased by 5,517 contracts. Crude oil continues to trade in a lackluster fashion. The market remains on the short term sell signal, but has not generated an intermediate term sell signal. Stand aside.
June gasoline closed 1.37 cents higher on volume of 172,547 contracts. Open interest declined by a whopping 12,865 contracts. This is the six day in a row that open interest has declined and brings the total to 46,916 contracts. Stand aside.
May copper closed 6.70 cents higher on heavy volume of 114,935 contracts. Open interest declined on the up move by 5,678 contracts. The rally in copper started on April 24, and in each subsequent session open interest has declined. On April 24, the market reached a low of $3.634 per pound and has rallied to make a new high for the move at $3.792 on April 26. During this three-day rally, open interest has declined a total of 7,453 contracts. Despite the rally, copper remains on a short term sell signal. For July copper to generate an intermediate term buy signal, the low the day would have to be above key pivot point of $3.7074. As I write this on April 27, the low for July copper is $3.7545. In order to feel comfortable on the long side, open interest needs to improve by increasing on rallies and decreasing on pullbacks. For more information on copper, please see the April 15 Weekend Wrap.
June gold closed $18.20 higher on volume of 141,827 contracts. Open interest increased by 4,562 contracts. Speculators should be consulting with their investment advisor or broker about accumulating gold positions for the longer-term.
May silver closed 85 cents higher on heavier than normal volume of 79,327 contracts. Open interest declined by a whopping 6.593 contracts. The decrease of open interest was extraordinarily massive in relation to the volume. Volume on April 26 declined from the previous day by 27,824 contracts when silver declined 39 cents. The two-day decline of open interest totals 8597 contracts. At some point, silver is going to be a terrific buy, and the shake out of speculative interests is healthy for the market. Stand aside.
The June Euro closed unchanged on volume of 226,470 contracts. Open interest declined by 3,862 contracts. As I pointed out in yesterday’s post, I believe the market will continue to rally despite the dismal economic situation in Europe. Due to the fragility of the markets in Europe, my opinion is to stand aside. I do not like being long the Euro because the market could turn on a dime.
The June Australian dollar closed 48 points higher on volume of 117,603 contracts. Open interest increased by 2,486 contracts. I cautioned speculators with bearish positions to exit the Australian dollar if the market pierces the March 28 high of 1.0388. As I write this on April 27, the market has rallied past that point and is currently selling at 1.0414. Despite the rally, the market will not generate a buy signal on April 27.
S&P 500 E mini:
The June S&P 500 E mini closed 9.50 points higher on volume of 1,668,322 contracts. Open interest increased by 37,006 contracts. Since April 24 through April 26 the market has rallied a total of 34.00 points and open interest in this time frame as increased by a total of 49,201 contracts. The three-day open interest increase in relation to volume during those days was very light. Long put protection should already be in place.