DECEMBER BONDS: December bonds have traded sideways after setting new yearly high of 119-18, currently trading at 118-31. The fact that the contract was unable to sustain the recent strength has generated sell signals form the daily MACD and stochastic oscillators. While the short-term pullback is expected, the weekly and monthly time-frames are decidedly bullish. Therefore, we prefer to stand aside and look to buy further weakness against the 20-day moving average at 118-12, and the September 11 trendline at 117-08. Upside targets lie at new highs to the 120-00 level.

MARCH EURODOLLARS: The daily technical studies for March Euros also look negative, and short-term weakness is expected. While aggressive traders can look to sell against 94.20, we prefer to stand aside and probe the long side against the August 8 trendline at 94.06. Target 94.25 with stops below 93.99.

DECEMBER GOLD: December gold continues to establish new relative lows, gapping to 297.0 as of this writing. Daily MACD continues to make new lows with price, confirming recent weakness. The bear trend will remain intact until the October 1 trendline at 314.0 is taken out. While we may not get the opportunity, new shorts are recommended on strength to 310.0. Next support lies at the January 1985 low of 286.6.

JANUARY CRUDE OIL: January crude bounced off 19.35 on November 21, currently trading at 19.73. While we expect the June 20 low of 19.24 to hold support, the daily studies have yet to provide any bullish signals. Nonetheless, we prefer the long side against the contract lows, but the bear trend will remain intact below the October 3 trendline at 20.94.

MARCH WHEAT: March wheat continues to establish new lows, reaching 349.4 on November 25. However, the daily MACD and stochastic oscillators are attempting to climb out of oversold territory, and we prefer the long side against the July 7 low of 343.6, or a break above the October 22 trendline at 357.4. Target the August 29 trendline at 380.2 with stops below 340.0.

JANUARY SOYBEANS: The technical outlook remains bearish for January beans following the break below the 20-day moving average at 718.0. Daily MACD and stochastics continue to fall bearishly, and as long as the November 11 trendline at 716.0 holds resistance, we look for a test of the October 30 low of 687.0.

DECEMBER YEN: December yen continues to get whacked, reaching 7833 on November 25, currently trading at 7878. The daily studies are in a very overbought condition, and we look to go long on a break above the November 3 trendline at 7960. Target a bounce to the June 11 trendline at 8314 with stops below 7830.

DECEMBER DEUTSCHEMARK: The D-mark broke below the August 6 trendline at 5709 on November 26, currently trading at 5695. The daily studies remain bearish, and further weakness is expected to the mid-October lows between 5595-5615. New shorts are recommended against the November 11 trendline at 5757 with stops on a close above the 20-day moving average at 5795.

DECEMBER POUND: The pound continues a pattern of lower highs and lower lows, reaching 16674 on November 26, and currently trading at 16706. With the daily MACD and stochastics oscillators maintaining a bearish bias, we will stay short below the November 11 trendline at 16899. Target new lows to the September 4 trendline at 16390.

DECEMBER CANADIAN DOLLAR: The Canadian Dollar made an attempt to rally following the November 25 BOC rate hike, but failed to close above the October 8 trendline at 7068. The contract has since established new relative lows of 7025, and further weakness is expected to 7000. However, with the daily studies in an extremely oversold condition, we look to probe the long side against the January 1995 low of 6998.

DECEMBER S&P 500: December S&P's have established a new pattern of higher highs and higher lows, and with the daily MACD oscillator crossing above the zero line we anticipate further gains this week. New longs are recommended against the October 28 trendline at 947.25 with targets at new highs to 980.50. Stops below 946.0.

November 26, 1997Roman I. Dutkewych

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