wmeubank@ocp.kcmo.com
COMMODITY REVIEW AND OUTLOOK
195 Route 6A, Suite 6, Orleans, Massachusetts
(October 10, 1997) CURRENCIES: SHORT TERM–Greenspan's comments sent currency traders out of the dollar and into the mark and yen. A rate hike on the part of the BUBA pressed the dollar, but comments from the Fed encouraged buying. Many traders suspect that the hike by the Germans means that the U.S. rate hike is more likely.
LONG TERM–Conservative or undercapitalized traders should stay away from the currencies for now. The ultimate trend of the dollar is still in question, and these are choppy markets.
SWISS FRANC–The December Swiss chart pattern is beginning to change. If an aggressive bull, consider buying a dip to the low 6900's with stops under 6833. However the chart is not clear and has not yet broken out to the upside. Until 7015 is taken out on the upside, selling may emerge on rallies into the upper 6900's. If aggressive and short term, sell the December Swiss on a rally into the upper 6900's with stops over 7015 or of 50-100 points. Be alert for a reversal as the 6900 area is approached. If 7015 is taken out, consider reversing to the long side. Break out traders might also hold out for that penetration. Objective is open.
RESISTANCE–Resistance remains near 7000, 7016, 7037, 7058, 7096.
SUPPORT–Support lies near 6921-6947, 6872-6882, 6860, 6780, 6740-6760, 6714-6695, 6635, with further support near 6602.
DECEMBER DEUTSCHEMARK–Aggressive traders might buy a pullback to the 5720's with stops under 5647. Be alert for failures near 5750-5760. The currencies have had some odd twists and turns. Option traders might buy calls. Objective is open.
RESISTANCE–Resistance lies near 5763, 5790-5800, 5844- 5858
SUPPORT–Support lies near 5727, 5675, 5647, 5607, 5580, 5538.
DECEMBER DOLLAR INDEX–The dollar looked sloppy recently, but the inability to make new low adds an ambiguity to the action. Still the action has been negative. Sell the December dollar on rallies to 9660 or so if aggressive, 9710-9720 if more conservative with stops over 9770.
RESISTANCE–Resistance lies near 9660-9670, 9705, 9740, 9770, 9820-9840, 9880- 9900.
SUPPORT–Support lies near 9620, 9580-9570, 9530's.
M. Steven Morgan
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