wmeubank@ocp.kcmo.com
GLOBAL ASSET MANAGEMENT
575 W. Madison, Ste. 2607, Chicago, Illinois
(October 23, 1997) WHEAT: Wheat futures remained fixed in its sideways pattern during the past week as a lack of news kept the market on edge wondering which way to trend. Weekly export sales were lower which was a bit of a surprise, but most buyers are starting to purchase Canadian wheat and bypassing the U.S. which could be a problem. Australia also indicated this week that their crop estimate for the upcoming crop has again been raised now above the USDA figure which should further worries that world supplies will be plentiful for a while. Overall, market internals remain mixed, but are turning weaker. From a technical standpoint chart action looks like a possible high has been made with the confirmation coming from any close below the $3.60 level. A close below $3.60 would project the market to at least $3.40. The trend in December wheat remains down, but would turn back up on a close over $3.73.
FUTURES STRATEGY–Short WZ at $3.90. Maintain a protective buy stop close only at $4.17.
OPTIONS STRATEGY–Short WZ at $3.80 calls at $.10. Maintain a protective buy stop at $.22.
Tony Montini
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