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GLOBAL ASSET MANAGEMENT
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(November 20, 1997) WHEAT: Wheat futures remained fixed in the sideways to lower pattern during the past week as the market bounced higher early on some strong sales, but ended weak after further sales were not sustained. Weekly export sales were 392,000 metric tons which were below expectations which will probably keep the weekly inspections near the low end next week. Australia also indicates that their estimate for the upcoming wheat crop has again been raised now above the USDA figure which should further worries that world supplies will be plentiful for awhile. The USDA on their recent release also upped their Australian wheat production figure which is a good sign the crop will be better than expected. Demand was a bit better with Pakistan purchasing a large quantity, but other than that, most buyers key bids live for other destinations. Technically March wheat remains in a downtrend; the market will turn back up on a close over $3.74.
FUTURES STRATEGY–Short WH at $3.61. Maintain a protective buy stop close only at $3.75¾.
OPTIONS STRATEGY–Sell WH $3.70 calls at $.07 or better. Enter a protective buy stop at $.19 if filled.
Tony Montini
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