1. FED MARKETS
2. MEXICO
3. QUOTES
4. ON THE WEB
5. TRAVEL
6. LETTERS
IS THE SUMMER RALLY OVER, OR WILL IT START (FOR REAL) NEXT WEEK?
Is your portfolio full of many potentially Citrix-like tech stocks
plunging more than 50% in a few days?
If so, I would be afraid, very very afraid. Better still, I would rotate
some of your holdings out of the high flying, aka Icarus technology sector,
into the Blue Chips, e.g. T, GM, by July. GM, along with railroad
stocks should benefit from Jupiter going into Gemini on the 30th of June.
However, we are not suggesting they will provide instant riches.
Buying GM, which is coming into "range" at 60, (although really worth 40),
is like buying JNJ at 68 or ATT at 34, not REAL value, but relative value.
I believe it should provide a relatively safe 15-20% 12 month appreciation.
With some Blue chip weighting, by the end of 2001, you may not be celebrating
your portfolio results with Dom Perignon, but at least you shouldn't need
a drink!
We are glad to see gold moving and have bought some recently in active trading accounts. It is possible we will see $300 next week. If not, we still have more chances later this year.
OIL: now that everyone wants it, we have been happily distributing (selling)
it to them: Buy low/Sell high. While the energy sector remains a
slightly above market perform sector, we are planning on reducing (selling)
all Oil stocks that we do not wish to hold into 2001 this Summer.
FYI: If I were OPEC's astrologer, I would recommend increasing the
band $3 from 22-28 to 25 to 31 to offset future dollar declines. This would
give them the maximum revenue, without decreased demand (unfortunately),
but would also fortunately increase investments in successor energies.
From the US Dollar decline, to Housing starts falling in May to the lowest level in a year, to South Africa, our May 18th forecasts are on target. Re(read) them at 2000/2001 Market Forecasts.
Key Dates: Traders Delight: May 20, 21, 22, 23
DJTA: Accumulate
on weakness <2650)
OIL:
Sell XOI 550-560; Short 580.
2. Until the Mexican election July 2, shorts of Telemex (TMX) could be appropriate. Thereafter, we could see a reversal with "good news," along with some buying of TV. One relatively safe play intermediate term is DESC (DES Adrs), which also may have an M & A kicker, i.e. takeover bid. Traders may prefer to buy or sell this market with EWW or Mexican IShares, aka WEBS.
3. "It's going to be a lot of mixed signals, or mixed currents
if you will. Historically the technology stocks in general have kind of
taken a break in the summer periods, so that's compounding the volatility
with fighting the Fed."
Christian Koch, senior tech analyst Trusco Capital Management
HW: Don't overlook the 3 July Eclipses either.
"With any of these stocks that disappoint on the tech side, people don't
want to own the shares."
Henry Asher, president, Northstar Group
HW: If Xerox drops 25% with $.12 earnings disappointment, what SHOULD
techs with no hope of earnings do?
4. "Investors should remember the 'three R's:
Resist the impulse to buy,
Research your investment and
Report fraud when it happens." Mr. Hoerl, SEC
Tips
for investors to avoid bogus stock pitches
By Cecily Fraser, CBS.MarketWatch.com
Trade
Deficit Could Signal Danger Ahead
By Jeff Madrick, NY Times
5. My next lecture is in Las Vegas on 7/11/2000.
6. READER: Are you still hot on AT&T (T)?
HW: All last year (from 55) we were bearish on T. But we do like
the communication sector with Jupiter moving into Gemni. Our current
buying of ATT is similar to our Disney Flip of being negative (at the right
time) to positive (at the right time) due to media membership and relative
(though NOT absolute value).
Yes, I am still HOT on ATT under 35 as it represents relative value
and therefore I believe it will outperform the general market. Will
you be happy by the end of July if you buy it today? That is MY forecast.
READER: Any thoughts on Lycos?
HW: I really don't LIKE most Internet plays, and when given the opportunity
to short them, I do.
READER: In you opinion, which have the quickest upswing? RD? Unilever?
Any opinion of Deutsche Telecomm (DT) as you did mention German Blue Chips,
that one seems rather beaten down.
HW: Not sure any are quick moves, but simply offer outperformance viz
US counterparts. Since May 19, we have already had a 10% Euro Appreciation.
Deutsche Telecom should benefit from further Euro appreciation into 2001,
and also could benefit from Jupiter going into Gemini. However, I
prefer to buy German banks over Telecoms, but remember, this is a play
mostly for 2001.
READER: Henry: MSFT has Jupiter crossing over its GEMINI ascendant soon.
Do you not think it will help to rally the stock, so badly beaten down?
Also worth noting is that ORCL and INTU share the same ascendant and I
believe one of the two, INTU I think, came to market one day before or
one day after MSFT. Even though MSFT can no longer "bully" as whatever
the appeals court outcome, certainly they will be more closely scrutinized.
However I think that W2000 and their wireless play will help to reascertain
MSFT as a dominant and global player, becoming more diversified in the
communications arena. Anyway, I do think that by summer's end the
above three will be higher and I hold two of the three mentioned.
HW: That may happen, but as I like to buy value not marketing (in the
case of Microsoft) these are not for me. Obviously ORCL and INTU are good
companies, but hardly bargain basement pricing. Perhaps we may decide to
pick them up during the next annual October scare. Still, it is not
a style of investing (momentum) that I feel comfortable with. CHACUN
A SON GOUT (Each to their own.)
READER: Are you still taking on new clients? I am getting too
tired of doing this alone and am looking for a fund who does believe in
astrology.
HW: Yes I am not yet that tired.
READER: Henry, Street.com
Poll ranked financial astrology #2 after Abbey Cohen.
HW: It is interesting that 52% prefer Abby Cohen to only 19% for Astrology.
The results seem to me somewhat of a lark poll. Had they mentioned
a financial astrologer by name then I would feel better about it. Maybe
next year?
READER: Re: Stox.com- do you expect a reasonable rise there in next
3 months
HW: Yes, but the Summer is NOT the time for microcaps. We believe it
will be the final 3 months of the year, although not as heady as January
to March, since we are past May, i.e. Jupiter/Saturn conjunction.
Still, at $4CD, V.URL seems cheap to me.
READER: What's wrong with IHI? It's down to $0.50.
HW: In my opinion, nothing new is wrong with the company, just its
stock price.
READER: I attended your New York City seminar last month and would very
much appreciate receiving a summary of the seminar. I was in Europe
last week and was not able to receive your weekly email update posted on
the web that had promised a recap of the seminar data.
HW: My forecasts are posted at May
2000 Forecasts.
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