1. US MARKETS
2. FOREIGN MARKETS
3. US REAL ESTATE
4. QUOTES
5. LETTERS
ECLIPSE TIME AGAIN: 1 DOWN, 2 TO GO
This weekend, the Moon, the Sun and the Earth will align for the longest
Total
Lunar Eclipse in 140 years
Then we have Mercury SD on Monday followed by a Bradley High on Friday's
options expiration. Will this portend the end of the summer rally?
We went short on Friday with WSNW
ALERT 43A and may double up on Monday. If stopped out by Tuesday's
CPI's news, we WILL play it again on Friday. Other astrologers are
playing it differently, e.g. Arch Crawford is using any eclipse related
selling as a buying opportunity up into Friday's Bradley high, while "Goldman"
is buying gold and/or will be selling the US$.
NASDAQ: MORE PROMISE THAN PROFIT
I can't believe I overlooked the obvious recent Motorola rally, given
its sector membership. Instead, we only get to play the easy crumbs
on the downside. We are in a Yahoo Summer market: general bullishness occasionally
tempered by reality. For how long will investors buy into the argument
that economic growth has peaked, that demand conditions could be lessening
a bit, and that the Federal Reserve might not have to raise interest rates
on Aug. 22? Until this Tuesday? Or this Friday? Or until
the last minute possible, August 22?
Before the fall pre-election market rallies, I believe there is a strong
probability we will first see Nasdaq retest 3000 and perhaps break it.
In any event, I see the March Nasdaq high in place until the end of the
year (at least).
As we wrote in our May
2000 Forecasts:
[The upcoming]"JUPITER/PLUTO and SATURN/PLUTO aspects plus new FASB
rules forecast more failed mergers and corporate break ups.": witness last
week Sprint & MCI. Traders will find there is just as much money to
be made when M & A plays FAIL as when they succeed. We also expect
tracking stocks to remain in vogue into the next market time cycle until
these aspects are over and separating.
KEY DATES: July 17, 18, 21
DJIA: 10500-10888
NASDAQ: 4000 ATTRACTION
2. ACCUMULATE EUROPE/DISTRIBUTE CANADA
The Toronto Stock Exchange's benchmark index jumped more than100 points at the open on Friday at 10,807, overtaking the Dow Jones industrial average for the first time since April 1995, but it closed at 10778.80 less than the US close. We have been Canada bulls since 1999; however, as we wrote last week, enough is enough. We recommend further selling of TSE stocks next week. Also, unwind our previous recommended [and highly profitable] Canada/US hedges such as "Buy Nortel/Sell Lucent" ASAP!
RE: Monetary Union "The size of Greece's economy compared to the Euro-zone
as a whole is so small that even if its inflation does pick up, it shouldn't
be an overall threat."
Bernhard Pfaff, Commerzbank economist
HW: While that is the official line and the Euro's horoscope in 2001
remains positive, more Southern [and Eastern] expansion at this time is
NOT good, except for the usual suspects, e.g. Greek telephone and bank
plays as well as giant European multinationals. We plan to reduce
Euro exposure later in 2002, when more reality begins to set in.
Note: Investing in securities denominated in currencies other than the US dollar involves both risk and opportunity not typically associated with investing in US securities.
3. "Buyers feel th've been chasing a runaway train, and if they wait,
prices will be better."
Barbara Corcoran NY Real Estate Broker
HW: I agree. Last week the Wall Street Journal article HAVE WE
PEAKED YET pointed out US housing markets are slowing as we predicted.
I am personally looking to buy NEXT year with stocks profits cashed out
from intermediate term stock holds near the end of the late Fall market
rally. Ideally, I would like to buy a new Penthouse apartment in
the midst of the 2001/2002 recession slowdown. Naturally, if I were
selling real estate, I would recommend doing it "yesterday."
4. “I think 4,000 on the Nasdaq will stick this time around. I believe
there are more upward moves to come.”
Barry Hyman, senior market strategist, Ehrenkrantz King Nussbaum.
HW: It remains to be seen if the market can withstand 2 more eclipse
tests. I have strong doubts.
"We do expect the culmination of the year-long+ Huge Topping Pattern
in the late July - mid-Sept time frame. So don't overstay!"
Arch Crawford
HW: Yes, the annual October scare should begin by then.
"We expect growth companies, like Ericsson, to continue to lead the
market because we're most confident about their profit. Phone companies
will have to build these new networks as quickly as possible.'"
David Ballance, head of European equities, Rothschild Asset Management,
London,
HW: Quite a few analysts believe that phone-equipment makers will probably
remain among Europe's most sought after stocks in the second-half of this
year. I guess they are tracking Jupiter's entry into Gemini! Then
again, what will happen on August 9 when Saturn enters Gemini?
5. READER: So here I am having bought T according to its astro. chart
and nothing is happening at all. When do you expect some action?
HW: Before August. ATT had one quick trading move that failed.
If it doesn't move above 35 by the end of the month, then you may wish
to sell or stop loss it according to your usual trading rule profit parameters.
I will most likely hold this stock till next year as an intermediate term
investment, which was our backup plan from the beginning.
READER: Are you saying that you expect it to break out on the upside
or the downside? Where are you expecting it to go? What stocks might lead
the way?
HW: Both: First the upside (which we have already seen) followed within
one or two weeks with a market reversal given the eclipse this weekend
and the Bradley high Friday. If the market breaks to the upside or trades
neutral and choppy, it will go down thereafter. However the reverse
is also possible next week as Arch Crawford is suggesting. Our benchmark
or leading stock indicators are IBM, HWP and INTEL.
READER: I have not received my newsletter today.
HW: We do not always send it out on Saturday. Often we send it
on Sunday, while occasionally we send it early Friday when we feel market
conditions warrant it.
READER: Needless to say my accounts based on a trending model
aren't doing too good lately. Is it time to shift money away from the trend
following accounts?
HW: We expect trends to remain neutral (choppy) over summer. We may
have a short spike up, but it will most likely be followed by another one
down. Then we expect an early October scare end of Summer. Thereafter
trend following models should profit from pre/post election rallies into
December.
READER: Re: WSNW
Alert 43A Sell. I [also] based this decision to short the close partly
on the Lunar Eclipse this weekend and partly because today was a cyclic
turning point date.
HW: GMTA
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