wmeubank@ocp.kcmo.com
THE REAPER
P.O. Box 84901, Phoenix, Arizona
(September 25, 1997) CURRENCIES: The December U.S. Dollar Index needs to hold above 95 support to bolster investor confidence. The strongest currencies against the U.S. Dollar presently are the British Pound, Swiss Franc and German Deutschemark. In Europe we also like the Spanish Peseta and the Norwegian Krone. In the Asian Pacific Basin, the Singapore Dollar, New Zealand Dollar, and Australian Dollar show signs of bottoming, as does the Canadian Dollar. The Japanese Yen has stabilized for now. The Malaysian Ringgit dropped to a 24-year low against the U.S. Dollar in the last half of September. West German business confidence increasing for five straight months strengthened the Deutschemark, and heightened concerns of a German interest rate hike. The U.S. Dollar weakened on its trade gap widening by 24.7% as deficits with Western Europe and Japan soared. The merchandise trade gap for goods and services jumped to $10.34 billion. How long until the currency collapse in Japan and the chaos among the Southeast Asian Tiger currencies, coupled with the upcoming Western European Euro, negatively impacts the U.S. Dollar, economy, stock and bond markets?
RECOMMENDATION–Futures investors profitably long December Canadian Dollar use 0.7189 open protective stops. Futures investors profitably long December British Pound use 1.589 open protective stops. Futures investors profitably long December German Deutschemark use 0.5579 open protective stops. Futures investors profitably short December U.S. Dollar Index use 98.51 open protective stops. Take partial profits in these currency futures. Futures investors may lightly purchase December Australian Dollar with 0.7179 open protective stops.
R. E. McMaster, Jr.
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