WALL STREET, NEXT WEEK
Financial Astrology for successful investors and traders"   
 
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WALL STREET, NEXT WEEK: AUGUST 9, 2004
FINANCIAL ASTROLOGY FOR THE SUCCESSFUL INVESTOR AND TRADER

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

SUMMER MARK DOWN 20%-35%?
Consumer Spending Drop Largest in 3 Years, while Friday the Dow fell nearly 150 points to a new 2004 low as investors bailed out of stocks in the wake of a disappointing jobs report and continuing high oil prices. Yet the Delusion of the Week had legs as SNOW claimed the US ECONOMY REMAINS STRONG, SOUND, AND ON A GOOD PATH. Was it just a coincidence that Nasdaq closed at the patriotic number of 1776? Markets arrived at our first H2 2004 trading target of 9822. Will Nasdaq next break intermediate term support at 1750? Markets, if they do not crash on more bad news on Monday, will be on hold for the August 10th FOMC meeting with its .025 rate hike. Will Alan come to the rescue once again with his old shoe of a story, that the FED will take care of the markets like a mother its infant child? While Wednesday is likely to be an UP day, past Wednesday, will they rally or instead reach our intermediate term P2 targets of DJIA 9605, SPX 1032 & NASDAQ 1750 or lower?

August has a SIDEWAYS Market Marker Sentiment: Initial Worry, then Rally, ending Flat.
Bottom line: Investors should remain cautious about geopolitical risks, higher oil prices and the U.S. economic outlook. But will they?

Meanwhile on the right side of the pond, the number Britons becoming insolvent hit record numbers in 40 years in the second quarter, as a series of interest rates hikes put bigger pressure on the indebted households and individuals. "Record personal insolvency figures reveal the pressures on people who have borrowed to the extremes and are struggling to repay their debt", said PWC's Patrick Boyden. COMING SOON TO THE LEFT SIDE OF THE POND?

HYDE PARK SOAPBOX: OIL POLITICS
Based on a model that equates prices to U.S. crude oil and oil product inventory levels, a “fair value'' price for New York crude is near to $25 according to Bill O'Grady, director of fundamental futures research at A.G. Edwards & Sons. Adding $10 for risk premium, $35 is its “natural” price. So why are oil prices so high?

U.S. oil prices hit new record levels above $44 a barrel after the head of the OPEC producers' cartel said there was little the group could do to cool red-hot markets. Oh really? They never heard of “forward hedging”? They are laughing all the way to the bank with OUR money. It is also possible that Putin cronies have been making billions on the Yukos on again, off again bankruptcy saga.
Folks, how about a realistic national energy policy that combines the virtues of conservation with serious R&D credits for renewable energy?

TRADERS:     COVER/PROTECT SHORT TERM SHORTS BY TUESDAY/WEDNESDAY.
INVESTORS: PREPARE BUY LISTS AHEAD OF THE “PLANNED” SEPTEMBER RALLY

KEYDATES:   AUGUST 9, 10
DJIA:               9605 SUPPORT 9827 PIVOT 10,000 RESISTANCE
NASDAQ:       1750 SUPPORT?
OIL:                 S1 42 S2 40 S3 38  PIVOT 44 R1 45 R2 50 R 3 52

SIDEWAYS Market Marker Sentiment: Initial Worry, then Rally, ending Flat.
DON’T BUY AND HOLD: BE LIQUID WITH A BALANCED AND DIVERSIFIED PORTFOLIO!
12/31/2003 EOD:    DJIA 10453   NASDAQ 2003 SPX 1111.
FAIR VALUE:        DJIA  <9600, NASDAQ  <1750, GOLD > 405
While the internal Stock Market astrology, as in 2003, is mixed, the external risk potential is very high.

2. STOCK OF THE MONTH CLUB REBORN
Given an expected post RNC rally in September, we are restarting our Stock of the Month Club.
Our Stock of the Month Club pick philosophy is to look for a minimum of 15-20% appreciation within 4-6 months. Thereafter we take profits, or use trailing stop losses depending on our market view at the time. Conversely, as intermediate term investments (not trades), if there is a 15-20% loss, we either double up or exit depending on any news, market conditions and astrological factors at the time.
These monthly stock picks are emailed in real time to all Wall Street, Next Week Subscribers.

3. Disney unveils PC with Mickey Mouse ears and Google to Delay IPO a Week Over Problems.
We do not see Disney becoming a computer powerhouse, but rather this Disney story as another example of a company ignoring its core business. As for the latter, it is clear that Google did not use its vast resources to hire a financial astrologer. This simple step would have easily avoided them the embarrassment of bad Nasdaq timing and an IPO delay.  Both of these stocks are on our “AVOID” list, unless the upcoming GOOG first trade horoscope demands action otherwise.

“Will Nasdaq hold intermediate term support at 1750, or will it achieve our first P1 long term trading target of 1525?
Should it reach the latter, we will begin to INVEST in select computer companies.  Should it hold the former intermediate term support, we will TRADE this sector short term….”
For recommendations of what to buy at Nasdaq 1750 and/or 1525, WSNW subscribers should visit our newly updated premium post: S: AFUND 2004 12 COMPUTER STOCKS.

4. "The Nasdaq remains in a very definable down trend, having traced out a series of lower lows and lower highs."
Mark Arbeter, chief technical analyst, Standard & Poor's
HW: True  but taking out 1750 will take a stronger dose of “reality” and economic truth. Additionally, will the “plunge team” permit this ahead of the November elections?

"The market is not priced for oil prices at record highs and rising interest rates and slowing earnings momentum and terrorist worries.  People are pretty complacent out there. The assumption is that the economy is mending and that this will be a robust, self-sustaining recovery."
Jeffrey Saut, chief investment strategist, Raymond James
HW: How quickly views change. All it needed it seems was for Mercury (thinking) to change direction in the sky!

"Risk appetite is very low and sentiment is weak."
Haydn Davies, chief economist at Barclays Global Investors
HW: Yes, but with Nasdaq above 1525, “risk appetite” is still far too high IMHO.

5. 5 Stocks for the Next 10 Years
YUM, MCD, TWX, WM, MCO

Oil Prices May Be Key to Market Strength
“Economic data is soft, interest rates are rising and oil prices are at record highs. Earnings have been good, but projections that they will decelerate in the months ahead have flat-lined stocks. What is going on here? If Wall Street is to break out of its current cheerless state, analysts say something has to give. Better economic news, a drop in oil prices or a reduction in global terror fears could go a long way toward stabilizing equities.”

Aethereal Gains - Another reason to get out of the real-estate market—right now

6. READER: Your Indian correspondent foresees Terrorist attack in Paris. [We forecast a major terrorist attack in Paris within the next four to five weeks by Islamic Militants who may have links to UBL. There may not be a major terrorist attack in USA in the near future. But with Paris burning - markets will crash worldwide. We hope our predictions about Paris are not correct.]
Any comment on that prediction?
HW: I have no opinion beyond that we are bearish on the Euro in August post FOMC.

7.  HERE WE TALK ABOUT AFUND CLIENTS
I just visited the Health Science NJ manufacturing facility and plan to post our first report on HESG later this month.
Given IHI’s biggest challenge has been sales, and with the news that Mr. Dan Hallman has been appointed Director of US Sales, I am here issuing a STRONG BUY on IHITF under .25!

READER: Looked at your website recently. Still no IHI update.
HW: I am awaiting IHI’s next press release before updating.
NOTE: IHI just released its update on Friday. Therefore I will be posting our IHI update this week. 
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(c) 2004 All rights  reserved.  The Astrologers Fund  "Always a Stellar Performance"
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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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Please read our Disclaimer for more information and note that my clients and I are shareholders and may act in the open market.
          
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