WALL STREET, NEXT WEEK
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WALL STREET, NEXT WEEK: MAY 24, 2004
FINANCIAL ASTROLOGY FOR THE SUCCESSFUL INVESTOR AND TRADER

1. MAY MARKETS
2. UP STARS/DOWN STARS
3. ASTRONUT
4. QUOTES
5. ON THE WEB
6. LETTERS
7. AFUND LETTERS

1. ARE YOU READY FOR THE SKY FALLING?
For how long will Dow 10K and Nasdaq 1900 fight for Support/Resistance? Perhaps as soon as Memorial Day, when investors could see these numbers as ceilings. Thereafter, 1850, 1800 and 1750 can follow in short order.  Perhaps we may even see our longer term trading targets of 1500 and 1400 by Summer 2004!

BARGAIN HUNTER’S WET DREAMS
Bargain hunters moved in after indexes retreated last Monday on nervousness over higher interest rates, oil prices and growing uncertainty over the U.S. presence in Iraq. But we believe this will be nothing compared with stock “bargains” that may be offered in June and July 2004.
DON'T BE IN ANY RUSH TO BUY.

TRADERS: SELL AHEAD OF MEMORIAL DAY.
INVESTORS: Prudence is the better part of valor. Stand aside, write calls or buy puts for June and/or July. Maintain very large cash reserves and 0 margin debt to sleep soundly at night. 

KEYDATES:       MAY 24, 25, 26, 27
DJIA:                  10,000 PIVOT
NASDAQ:          S1 1850 S2 1800 S3 1750 1925 Pivot
OIL:                    SELL/HEDGE $44 OB
GOLD:                SECOND BUY

MARKET SENTIMENT IS NOW WORRY AND SOME FEAR, BUT NOT PANIC.
DON’T BUY AND HOLD: BE LIQUID WITH A BALANCED AND DIVERSIFIED PORTFOLIO!
12/31/2003 EOD:    SPX   1111 DJIA 10453 NASDAQ 2003.
FAIR VALUE:        DJIA  < 9800, NASDAQ  <1850, GOLD > 400
While the internal Stock Market astrology, as in 2003, is mixed, the external risk potential is horrific!
Short term, If you were unhappy about markets March 2000 and September 2001, don't expect to be singing in the rain JUNE 2004!

2. “Until recently, high energy prices have continued to defy most energy forecasts as periodically, oil supplies have been disrupted from unrest in Nigeria, political instability in Venezuela and especially continuing problems in Iraq. Equally important, the US is predicted to import a record amount of oil this summer. The question on everyone's mind is whether $40 will here in 2005, or a bad, distant, nightmarish memory? Our current belief is that $44 will be the effective 2004 ceiling, and $1.55 to $1.60 for gasoline futures. Hence, we believe it is beginning to be time to distribute such recent refiner winners as Valero (VLO) and Sonoco (Sun), as well as drillers such as RIG and SLB, especially the latter, should high oil prices not be present this summer.  Given this macro view, we plan to watch integrated verticals such as BP, CVX and RD.  Unfortunately, we don't see successor energies of Solar-Hydrogen meaningfully deployed to begin to replace fossil fuels until 2008. Still, as aggressive speculative investments, they can be periodically "trading attractive". Please review our watch list for several potential longer term winners….”
WSNW subscribers should visit our premium post S: ENERGY 2004 for more details.

I only wish all of my stock selections would be as successful as our recommendation of Kroll (KROL), which soared more than 30% 2 days after our May 2004 forecast when the company agreed to be acquired by Marsh & McLennan. Sadly, many defense sector/homeland securities stocks are likely to outperform over the next 30 days. WSNW subscribers may wish to study our S: AFUND MAY 2004 Stock Market Forecast, while non subscribers can either wait until mid June when we post it on our public site, or subscribe to WSNW. 

3. Indian political shifts turn investors' heads
India's stock market took the biggest plunge in its 129-year history last Monday as investors panicked. The government reportedly instructed state-run financial institutions to buy heavily into the market so to stop the tumbling share prices. The Securities and Exchange Board of India ordered suspension of trading twice as stock prices tumbled more than 15%.  No doubt the US FED was “watching”. After the Bombay Stock Exchange fell 11%, it rose 8% the next day and then 3% the day after.  Ah… who ever said investors were NOT rational?
“The most successful investors in India capitalize on the swings in sentiment to buy in the gloom and sell in the boom. With further selling by foreign investors likely, the time to buy may not be quite yet. But the Indian market is no longer expensive compared with Asian peers. The economy remains strong and a 15% rise in corporate earnings is expected this fiscal year.” The Lex Column FT.
We agreed wholeheartedly and so recommended trading buys on Monday.  However, we are also now inclined to further reduce exposure to India circa BSE 30 5000
For monthly updates on the Indian Stock market, we direct WSNW readers to read INDIA 2004 by AFUND guest columnist Taran Marwah.

4. "The risks have risen; things aren't as bullish as they were a few months ago. It's a mixed picture. We're going from a green light to a yellow light, but we're not at a red light yet”
Sam Burns, analyst, Ned Davis Research
HW: True, it may take until this coming Wednesday or even until the ides of June, but red it will be.

"We have all-time highs in terms of oil prices, a ballooning likelihood the Federal Reserve will raise rates, and instability around the world especially in Iraq, which all makes for pretty negative sentiment" Brian Bush, research director, Stephens
HW: Not negative, but a smidgen of realistic, rational thinking IMHO.

"I think what is happening is the markets are trying to sense whether there is a building inflation story or whether they should focus on the earnings, which have been very good. That's why you're seeing this extreme volatility on smaller moves, like the rise in oil prices."
Subodh Kumar, chief investment strategist, CIBC World Markets.
HW: I thought the extreme volatility was more due to increased hedge fund influence in the markets.

5. A HIKE? NO SWEAT
“Fears of higher interest rates sent stocks diving for the deck last week. At one point, major indices tumbled to their lowest levels of the year, as traders nervously anticipated a Federal Reserve tightening at its next meeting in June.”

Sell in May? Not This Year, Investors Say
These are extraordinary times, where geopolitical risk and outlook outweigh seasonal trends," said Barry Hyman, equity market strategist at Ehrenkrantz King Nussbaum. "These patterns will not work all the time."

Investing: Trying to Turn Risk Into a Safety Net
“STOCKS are still awfully pricey, at least by historical standards. And with interest rates rising, bonds may be primed for a fall. That could add up to a nasty one-two punch for the average portfolio. So, many financial advisers say it may be time to start looking into alternatives like hedge funds as well as mutual funds that invest in real estate and commodities.”

6. READER: Glad to see you Clyde Haberman's [NY Times] article [A Planetoid Colliding With Critics Does Sedna, named after the Inuit goddess of the sea, qualify as a new planet?]
HW: Yes, very well done and good fun to read.

READER: I have the feeling that 15/16 June 2004 becomes a scary day. What do you think according the planets?
HW: Unfortunately, astrologically, there are lots of “scary days” starting from the end of May through June 2004.

7. HERE WE TALK ABOUT AFUND CLIENTS
We are pleased to have added Health Sciences (HESG) as our newest AFUND client.  They have some very positive astrology upcoming (to be discussed later). Take a look. I will post some information on it shortly.

READER: How much time should we give GARQF?  I bought @ $.0575.  Thanks
HW: There are two parts to the Gallery story. The first is the gold sector itself, which until last week was battered.  Do you want to own gold stocks? I believe the answer is yes, at least as a hedge, and I believe gold will be well over $400 again this year.  This should bring you to even or slightly ahead. The second is whether you want to own this particular gold stock.  Gallery is a high risk microcap exploration company without large proven reserves. If they hit, you do very well.  If they don’t you don’t.  I am still holding my shares and waiting to see the results of the parcels identified in April and the current fly bye. I would probably give them to Summer/early Fall. Thereafter, you often enter into a seasonal down cycle for gold exploration microcaps (assuming no strike before then.)

Re: Haven’t checked. Don’t see the need to. Will be seeing Gallery early next month at the NY gold show and may after that. If I had something new to say positive or negative I would see the point, but since my views [on the company] remains the same, I don’t.
READER: The new thing to say is that Gallery is no longer a client like you done in the past when existing clients are no longer your clients.  It is just a simple fact to update your readers on.  Otherwise, they like me assume that Gallery is still a client.  It doesn't hurt to state the facts.
HW: As of May 2004, Gallery was no longer an active AFUND client.

READER: What we really need is the High Rise construction deal in Vancouver/Canada, or something close to home (Canada)- to get it confirmed and PAID UP - then this news might breath some life into IHI stock price! Business success and winning sizeable orders (not oil rig platforms or mobile homes!) at home or in North America will really give credibility.
HW: That is one of several projects IHI is working on aggressively. It has now progressed to being 2/5 completed.

READER: Will there be any announcement before [IHI] AGM, or should we wait until September?
HW: I don’t know: it could be this month; it could be September (or before).  It is hard for me to say. Assuming, IHI stock is still hovering near 52 week lows, I am planning on buying some more IHI stock in June ahead of the Company’s AGM, when markets, in general, will be down to profit from this possibility.
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Author: INVESTING BY THE STARS, THE STUDY OF ASTROLOGY,TRADING BY THE STARS (01)
May 13-15, 2005 Eleventh Astrology & Stock MarketConference   NYC
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