1998 4Q FORECAST UPDATE


1998 MIDYEAR MARKET FORECASTS

Much of the following has been serialized in our newsletter WALL STREET, NEXT WEEK and was first publically presented at the 6th Annual Astrology and Stock Market Seminar May 15 in New York City.

There are 2 primary astronomical phenomena affecting world events and the markets in the second half of 1998:

We expect the August eclipses to demark and precede another market top or trigger at least one market mini-crash and/or bond reversal.

The second celestially marks a "rock (Saturn) on a cloud (Neptune)". Two notable industries affected so far have been the Oil sector and high end retailers. The first Saturn-Neptune Square Date (June 25) was also a perfect cosmic marker for the ATT-TCOMA merger announcement disaster and an OIL drop of 4%, as well. As to the Microsoft Windows 98 launch that day, time will tell.

1998 Market pivots 8000 and 9000.

Major Technical Support areas are 7230, 6950 and 6390.
Resistance at 8400,9000 and 9300.

See the FRANCE posts of Jean-Francois Richard or download his graph of CAC 40 June 1998 to March 1999 Forecast for a forecast in harmony with mine that largely applies to all the European bourses, and the SP500 as well.


I GLOBAL INVESTING

THE HOROSCOPE IS A MAP OF TIME AND PLACE - here is a brief overview of some of the world markets we cover:

ASIA Trading and long term investment opportunities

INDONESIA - Too MANY problems short and intermediate term. Hedge funds can trade the Rupiah to a 10000-9000 fix.

JAPAN - Mixed. Long term we like the Yen at 135 OB, and exporting and construction companies.

HONG KONG - Like long term and select red chips but AVOID the property sector. Currency devaluation probable c.f. Drachma/Greek market surge, despite offical US-Chinese protests to the contrary.

KOREA - Korean Won currency stable, key companies will survive and prosper.

EUROPE - Relative bargains,but less so second half of 1998 than the first. Euro not a strong currency in 1999, especially midyear.

ITALY - Continued out performer rest of 1998, but many European charts, including Italy's, show a potential problem circa summer 99 eclipse. Exit well before then.

HOLLAND - Replaces Italy as our "favorite country" in 2000.

NORTH AMERICA

CANADA - AVOID, a disaster as early as this Summer/Fall to late 1999.

1) Canada's horoscope indicates a large PROBABILITY for a currency/economic/ political crisis due to the Quebec problem. The Canadian dollar will continue to fall.
2) Natural Resources are in the toilet. Over time we plan to buy at bargain basement prices. We believe in the CONTRARIAN PHILOSOPHY of "buying when others are selling and selling when others are buying".

UNITED STATES - Overvalued and a ticking bomb without a healthy correction (reality) before May 2000. Beware when the US dollar is no long THE safe haven and it has competition from ECU and even GOLD.

AFUND COVERAGE Forthcoming:

ISRAEL - Positive, especially software and hi-technology companies.

NORWAY - Oil rich and may avoid some ECU problems.

SINGAPORE - Will selectively benefit from Asian situation; intermediate term buy later this year, e.g. cash rich Singapore telecomm. (SGTCY).

CUBA - Coming sooner than you think: Hotels/Resorts and prime real estate.


II TIMING

Traders believe "Making money in the market is all about Timing".
Since 1997 and before, two big cosmic markers have dominated the stock market:

(1) The first planetary theme was Jupiter/Neptune, or what Alan Greenspan named "irrational exuberance".

(2) The second planetary theme has been Jupiter/Uranus, or "instant riches".

As we approach May 2000, the new planetary theme will be Jupiter/Saturn. This major pairing of the two planets will reward Value as much as Growth, and markets will show more traditional common sense valuations.

Over the next two years, real assets will begin to outperform financial assets. I believe $100,000 invested in Real Estate today will be worth more than $100,000 invested in the stock market. Basic industries such as Construction, Real Estate and Consumer stocks, or even Insurance and Education, will be favored. Think in terms of tangibles. If you are a very aggressive investor and have high risk tolerance, some commodities, along with stocks, bonds and cash may be appropriate.

The upcoming Summer cosmic markers are the Saturn/Neptune Square on June 25 and a pair of eclipses this summer: Lunar Eclipse August 7 and Solar Eclipse August 21. Saturn (rock) - Neptune (cloud) suggests that some of the high flying bubble stocks will come down to earth over the next few months. Take or protect your profits with any high risk, i.e. "value-challenged" stocks. Remember, the 1989 Saturn/Neptune Conjunction timed the end of the Real Estate boom of the 1980ís.

Sophisticated astrological traders are also looking to July 20 as a possible turning point due to changes in the angular momentum of the Sun. All financial astrologers are carefully watching the August eclipses for possible extreme market volatility.


III SECTORS

2. 1998 Relative Sector Weighting Update:

++

Construction

Real Estate

Insurance

+

Education

Health Care

+/- (Best short term trading opportunities)

Techology

Telecoms

-

Oil

Drugs

Internet/Gambling

Natural Resources into 2000:

+ Gold - $350-$400 test in 1999;

- Oil - Saturn/Neptune Theme until early 99.

0/+

BONDS - 4th Quarter positive.


IV STOCKS

2. Having my Moon in Libra, my Stock Selection is both:
TOP DOWN: Country/Currency, bourse/sector, individual stock and
BOTTOM UP: with very strong indications.

I like to begin with one or more of the following 3 criteria:
A. NEAR 52 WEEK LOW (a preference for fallen angels)
B. CASH RICH, not stock rich especially from Fall 1998 on
C. GOOD HOROSCOPE OR STOCK IN UPCOMING COSMIC SECTOR THEMES
1) Saturn/Neptune
2) Eclipses 1998/1999/2000
3) Jupiter/Saturn 2000
FAVORITE STRATEGY HEDGING:
BUYING STRONG STOCKS/MARKETS and SELLING WEAK STOCKS/MARKETS

See my May UIT for suggested summer stock purchases. This was issued for our May seminar; target only 10% -12% within 12 months and of course, out performing benchmark indexes.

As to the Netherlands, our favorite 2000 country, the top 5 stocks are dominated by Shell. The Dutch talk about the index with and without Shell. I prefer without SHELL this year.

Unilever: UL - Good "Defensive" stock and a better value than PG - PE 13 vs 32.

ABNAmro: AAN - Our current preference, over our old favorite ING Bank.

Philips - A turnaround story and will out perform in the tough electronics field.

Reed Elsevier - Less positive indications here, wait until focus shift next year.

We are slowly accumulating construction sector stocks and selected Reits (more of the latter in 1999). Watch Catapillar (CAT), Kubota (KUB) or International Hi-Tech Industries (IHITF). And what REIT has more class than my namesake Weingarten Realty (WRI)?

TECHNOLOGY *

BIG LOSERS: AOL, AMAZON: AMZ and HEWLETT-PACKARD: HWP.

Good Companies, but fully valued: ORACLE: ORCL, IBM, and SUN:SUNW.

INTEL: INTC - accumulate this summer

COMPAQ: CPQ: Dec merger will take time, and currently losing market share. Short till 25, then reverse 18-22 and long term buy.

Motorola: MOT - VERY positive out performer and not because of Siemens (but new management focus AND horoscope). Another Novell story.

Lucent: LU - Example of Roth rule 1. Great company - silly price; Market neutral. * Note: sharp relief rallies are probable.

MISCELLANEOUS RECOMMENDATIONS

DIJA FORECASTS

  • STRONG SELL: HEWLETT PACKARD (HWP)
  • INTEL- We repeat our Intel Forecast written 8/27/97 for November Worth Magazine: "Sell over 80 and on rallies into the Spring, BEFORE April. Buy to accumulate next summer, and/or 55-65 next year. However do NOT expect it to reach 1997 highs in 1998. Intel this year was under Saturnine influences. They made a serious mistake in doling out technology (not delivering 300MH) this past spring and keeping prices too high. This allowed their competitors to gain a PERMANENT foothold among computer manufacturers. Because of this profit margins WILL CONTINUE to deteriorate into 1998 (although from high levels).

    Starting this Summer, Intel is under Jupiter aspects and should offer new and better products, albeit with less generous profit margins. This should begin to reverse Intelís price decline even as it deals with more earnings disappointments and less lofty P/Es."


    Since May 2, 1988 I have established a superior forecasting record, primarily due to my knowledge of financial astrology. As more of our forecasting is now private and contracted to money managers and institutional investors, it is my intention to have other financial astrologers and money managers contribute more on my web site in the coming year as compensation.

    Henry Weingarten

    PS. Can you afford NOT to have a financial astrologer in your future?


    1998 Market Forecast
    1998 FORECASTS TRACKING
    email The Astrologers Fund

    (c) 1998 The Astrologers Fund. No part of this report may be reproduced or distributed in any form or by any means, except for brief passages quoted for review without the prior written permission of the publisher.

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