Dear Futures Trader,

What follows is the second issue of FutureSource's newest
service, "FAST BREAK." Each weekly issue contains a discussion
of the markets between two well known analysts and contributors
to FutureSource, Jim Wyckoff and Dave Hightower.

David Hightower is editor of the "Hightower Report",
available on FutureSource Professional and ProNet. Call
800-621-2628 for more information, or click below:

            http://pronet.futuresource.com.

Jim Wyckoff is a regular contributor to FutureSource.com.

You are receiving this because you are a customer of
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________________________________________________________________

        F U T U R E S O U R C E ' S   F A S T   B R E A K
Volume I                December 28, 2001               Issue #2
________________________________________________________________

The past couple weeks have witnessed higher volatility in the
currency markets, in the wake of a political and economic
meltdown in Argentina, and as two nuclear-armed nations (India
and Pakistan) step up their war rhetoric. Let's get the opinions
of two seasoned and respected market analysts: David Hightower,
editor of the Hightower Report (http://www.futures-research.com)
and Jim Wyckoff, proprietor of "Jim Wyckoff on the Markets."

FUTURESOURCE.COM: Dave, give us a basic fundamental
perspective on the U.S. dollar and its major counterparts.

HIGHTOWER: The U.S. dollar appears to have an entrenched bullish
sentiment over the Euro and we would expect interest in the
dollar to increase into the kick-off of the physical Euro
currency implementation.

However, it would seem that the dollar was quickly shut off from
further buying this past week when it reached above 118. This is

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the second time that the dollar has been quickly repelled from
that level.

We have been suggesting for weeks that the US dollar is holding
an extreme premium versus most of the world's currencies.
Therefore, a leveling out of economic conditions would seem to
pressure the dollar.

We also think that the U.S. dollar has seen an unsustainable
windfall off of Japanese yen weakness. Therefore, it is possible
that the dollar will see a blow-off top in the coming week and
that a major top could be formed.

Historically, it would seem that several major turns in the
currency markets have come in close proximity to the beginning
of a new year. In the event that the dollar does turn down, we
have to think that the Canadian and the Swiss will see the most
significant recovery capacity.

FUTURESOURCE.COM: Jim, give us more of a technical view on the
U.S. dollar index and the major IMM currency futures.

WYCKOFF: The past two weeks have seen the March U.S. dollar
index spring sharply higher, after prices had been trending
lower during late November and the first have of December. Last
week, the March dollar index hit a high of 118.85, and has since
seen some healthy consolidation of the recent strong gains.

The dollar index bulls indeed have the near term edge, and the
longer-term charts are also friendlier to the bulls. If the
bulls can push the March dollar index above the 119.00 level,

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that will give them the momentum to challenge the July high of
121.29. A drop below 114.75 means the market will likely
languish in more of a choppy and sideways trading range in the
near term.

Bulls should be warned that if prices do sell off from here, a
big head-and-shoulders top reversal pattern could develop on the
weekly continuation chart for nearby dollar index futures. But
right now, the bulls are enjoying the technical advantage.

As for the Euro currency, the weekly continuation chart for
nearby Euro futures should give the bulls some encouragement, as
well as throw a scare into U.S. dollar index bulls. A longer-
term downtrend line drawn off the 1998 high was penetrated on
the upside and negated just about a year ago. Since that time,
prices have been trading sideways in a choppy pattern. This
choppy trading has also formed a coiling pattern--whereby the
sideways trading range has become more compacted the past
several weeks. This is suggestive of a bigger "breakout-type"
price move in the not-too-distant future.

Given the recent lowly price levels in the Euro, odds do favor
that potential breakout being to the upside. There is also
potential for a big double-bottom reversal pattern on the weekly
chart. Indeed, there are clues on this chart that suggest the
Euro currency bulls will enjoy more success in the coming year
than they did in the past year.

From a shorter-term perspective, if March Euro currency futures
prices drop down below the November low of .8708, then the door
is opened to much more downside. If that low can hold and prices
work higher, then a big double-bottom reversal could be in the
works.

Finally, the Japanese yen has been in a nosedive for nearly two
months. This steep decline appears to be a "washout" or
exhaustion-type selling phase that many times precedes a major
change in trend. But bottom-pickers should beware. Right now,
would-be long-side traders do not want to stand in front of a
steaming locomotive. They should first let the market show them
some solid signals of strength before attempting to board the
bullish train.

FUTURESOURCE.COM: Thanks for the comments, Dave and Jim. We'll
look forward to more of your insight in the coming weeks.

----------------------------------------------------------------
DISCLAIMER: Futures and Options trading has large potential
rewards, but also large potential risk. You must be aware of the
risks and be willing to accept them in order to invest in the
futures and options markets. Don't trade with money you can't
afford to lose. This is neither a solicitation nor an offer to
Buy/Sell futures or options. No representation is being made
that any account will or is likely to achieve profits or losses
similar to those discussed in this newsletter or on these web
sites. The past performance of any trading system or methodology
is not necessarily indicative of future results.


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