Open Interest of various commodities

Open Interest is a good tool to gauge whether money is flowing into the product or flowing out.

By checking out the Open Interest of various commodities, we can roughly gauge their price trend.

As Open Interest increases, more money is moving into the futures contract and vice versa. Open Interest represents the total number of open contracts and volume is the total number of contracts that have changed hands in a one-day trading session. It is important that observe the relationship between open interest and volume. By using open interest, traders are able to forecast the trends and momentum opportunities, and also augur the market timing on trades. According to the theoretical base, rising in volume and open interest reveal the continued movement up or down. In other words, when the volume and open interest decline, the theory perceived that the momentum and movement are decelerating, and the direction of prices will soon reverse.

We can see the Open Interest in natural gas is still at a high range, maybe due to the natural gas supply shortage in Europe while the Open Interest for WTI oil and soybean oil has diminished.

WTI Oil

Natural Gas

Wheat

Corn

Soybean

Soybean Oil

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