wmeubank@ocp.kcmo.com
ASPRAY'S GLOBAL TRADER
Dollar Closes Weak Along With U.S. Market
Is The Dollar Ready to Break Stronger Support
The markets are reported as of the close Thursday.
The dollar tried to stabilize early then rallied in NY along with the stock market. The dollar closed weak as stocks dove in the last hour. The dollar still looks weak versus the DMK and SWF, with the daily technical studies negative and declining. The dollar is closer now to trending lower as more important technical and psychological support is now being approached. We would not be surprised to see these levels broken over the next few days.
The dollar also sagged in late trading versus the yen and with the negative readings from the daily studies a sharper dollar decline still looks likely.
DEUTSCHEMARK/DOLLAR: The dollar dropped to the stronger support at 1.7100-30 in early NY trading as stocks came under heavy pressure. The dollar then rebounded along with the stock market, but ran into a brick wall in the 1.7260-80 area. The next widely watched support is at 1.7080 with daily trendline support in the 1.6950-80 area. Major retracement support at 1.6800. The APMosc is clearly negative, but still above the lows.
Summary--Traders are 25% short at 1.7441-43, stop at 1.7337.
DEUTSCHEMARK/YEN: The cross pushed above the 70 level again today, but was not able to accelerate to the upside. Near term support at 69.70 with more important in the 69-69.30 area. Should be 25% long at 69.44-74, stop at 68.77.
Crosses Hold Firm But Dollar More Vulnerable
The dollar traded in a relatively tight range today as the near- term resistance in the 120.60 area limited the rallies. Still stronger resistance at 121-121.20. The dollar did break the 120 level in late trading with further support in the 119.50-80 area. Another decisive break below these levels when combined with the negative readings from the daily studies should cause more serious dollar selling. The daily chart shows what is now looking more like a continuation pattern. The uptrend was broken a few days ago, but the dollar closed well above the trendline support. The daily indicators, like the APMosc, are negative with no signs yet of a bottom.
Summary--Go 25% short at 120.42-85, stop at 121.23.
STERLING/YEN: The STG/yen has dropped back to test the 200 level which appears to be holding. Traders are 25% long at 200-200.54, stop at 198.83.
SWISS FRANC/YEN: The resistance at 86 has again been overcome and the daily technical studies still looks positive. Traders are 25% long at 84.40-76, stop at 84.33
Sterling Starting To Trend Higher
The STG is still locked in its trading range of the past few days with initial support at 1.6640 and stronger in the 1.6580-6600 area. Resistance first at 1.6700-50 with more important above the 1.6800 level. The daily studies are positive and the ADX line has moved above 30. This indicates the STG is trending higher. Traders are 25% long at 1.6640-90, stop at 1.6577.
STERLING/DEUTSCHEMARK: The cross broke below the support at 2.8750 and dropped sharply all the way to the stronger support in the 2.8600 area. The cross is trying to rally from these levels, but the overall technical outlook is now neutral to slightly negative. Was 25% long at 2.8790-8874, stopped out at 2.8734.
STERLING/SWISS FRANC: The STG/SWF continued to drop today as the more
important support at 2.3200 has been reached. No signs yet of a bottom
and will look to sell a stronger rally. No position.
October 31, 1997
Thomas E. Aspray
APM Asset Management
P.O. Box 15366, Little Rock, Arkansas
Technical Corner Index
Added to the WWW 10-31-97
Last updated on 11-01-97
Hosted by:
One Crossroads Place
610 West Maple Ave, Suite WWW
Independence, MO 64050
(816) 252-4080
sysop@kcmo.com