WALL STREET, NEXT WEEK
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WALL STREET, NEXT WEEK: DECEMBER 13, 2004
FINANCIAL ASTROLOGY FOR THE SUCCESSFUL INVESTOR AND TRADER


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

YEAR END PROFIT TAKING AND TAX LOSS SELLING
Short term markets are likely to be mixed, i.e. within recent range bound up and down market action. On the one hand, hedge funds are right to book their stock and currency profits.  On the other, we have positive market seasonality. Hence we expect at least one more tradable [150-200 Dow point] UP and down move each before year end. For the next two weeks, our trading and investing strategy respectively, is to trading buy January effect microcaps, while slowly buying any unwarranted tax loss selling dumps.

Meanwhile, back at the ranch, U.S. household debt up 9.1% in Q3, yet, Property taxes rising nationwide. These two stories seem to confirm two of our big 2005 themes: our forecast for $500 gold, coupled with lower housing prices by July 2005.

TRADERS: This week is better for investing, i.e. entering and exiting intermediate term positions, than positional trades. Day trade news instead.
INVESTORS:     Accumulate tax-selling December dump bargains.


GUEST HYDE PARK SOAPBOX: DISGRUNTLED EUROPEANS
Europeans are increasingly disgruntled with U.S. foreign policy, according to a European Union
poll published Friday, in which only 22% of respondents said they saw the United States playing a positive role fostering world peace.

WALL STREET, NEXT WEEK NEWSLETTER CHANGES COMING.
Please send us your input on what you would like to see in 2005.
 
KEYDATES:    DECEMBER 14,16
DJIA:               10,453 2003 December 31 Benchmark Marker
NASDAQ:       2050 Support 2100 PIVOT 2150 RESISTANCE   
GOLD:            425 Support 440 PIVOT 460 Resistance

2005 Market Marker Sentiment: First Bullish, then Bearish.
DON’T BUY AND HOLD: BE LIQUID WITH A BALANCED AND DIVERSIFIED PORTFOLIO!
12/31/2003 EOD:    DJIA 10453   NASDAQ 2003 SPX 1111.
October Lows:         DJIA   9660,  NASDAQ 1899 SPX 1090
DIJA:                       3 ~ FV 0 UV; 4 offer 4%+ Dividends.
While the internal Stock Market astrology, as in 2003, is mixed, the external risk potential is still high.

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2. Our December Stock of the Month Club Picks were Placer Dome (PDG) and the AFUND MICRCOCAP 5, 5 small cap stocks we recommend buying sometime in December to take advantage of the seasonal January effect in Microcaps. Our target or projected return is 35%+. 
 
We plan on doing little fresh investing between Tuesday’s FOMC meeting and the Winter Solstice. The reason: we are naturally waiting at least until Mercury turns direct on the 20th.

3. The KSE or Karachi 100 Pakistan stock market continues at record levels. Clearly, it has been one major beneficiary of the US-Afghanistan war game. This is not a market I am familiar with, so I have little to comment on beyond speculating what other country bourse(s) could benefit from a US strike at Syria, Iran or North Korea, the three major current US evil empire villains.  One answer is likely to continue to be Egypt, which rallied more than 50% in 2004.  According to egyptianstocks.com, the Egyptian Stock Exchange is expected to witness a boom during the coming period, in line with the foreign investors’ return back to the market. They noted that investors are awaiting new economic policies by the beginning of the new fiscal year. In other words, it is question of WHEN insiders will sell.  We think it could run a bit further first. But given that we hold little first hand knowledge of the region’s companies, I simply find it an interesting stock market phenomena to observe, but not play.

4. “Everyone is quite sure about the trend -- the dollar is going down and come the new year everybody will be fresh and ready to sell dollars As long as it doesn't poison the U.S. equity markets I think the U.S. is very happy with the dollar keeping falling.''
David Bloom, currency strategist, HSBC Holdings
HW: What short term thinking.

“Markets can overshoot and undershoot, and they often do, but the virtue of markets is they're self correcting.''
U.S. Treasury Secretary John Snow
HW: How true, but just imagine how weak the dollar would be if the euro overshoots? On par with the Peso or Yuan?  Of course not, but severe long term damage will have been done.

"It's important that we stop the collapse of oil prices."
Ali Naimi, oil minister of Saudi Arabia
HW: I agree. We recommended that Thursday was the appropriate time for Hedge funds to SAR (Stop and Revese) their short term December oil shorts.

5.  We Pledge Allegiance to the Mall
“We outsource everything except consumption, and that is not sustainable much longer," said Stephen S. Roach, chief economist for Morgan Stanley, arguing that the indebtedness involved in America's obsessive spending will soon disrupt exchange rates, damaging economies.”

Solid gold reasons to own gold
“There is no way for the government to preserve the purchasing power of the dollar by anything other than ceasing all monetary expansion, which the Federal Reserve System never does."

When Picky Analysts Pick

6. READER: You recommended recently TNXT. The stock is now down at 0.67 USD.I think
there is 2 possibilities:
1.Very oversold and a good bargain.
2.Negative news?
HW: I suggested buying before Thursday MOC.  There is no negative news that I know of.  Just that this is microcap tax season.  Some investors who bought above $2.00 last year may be doing a tax wash.  One has to look at charts. As a trader I would buy around .65 and sell around .95. As an investor, I could buy anywhere around here and “hope” for better numbers.  As 1/5 the AFUND microcap trade, anytime this week is fine.

READER: At what price can an investor get back in PDG & ABX?
HW: PDG could be 19-20, although 18 is possible. [18.25 was our first recommended buy].
As for ABX, I am not sure. Pricewise the 22 zone is good for hedging, but not sure if for short term trading as well. I have sold it and am waiting to rebuy.  PDG is our first gold re-entry.
WSNW SUBSCRIBERS NOTE:
“There have been a lot of questions when to buy PDG. I wrote before Thursday MOC and under 20. Actually it the price is between 18 and 19.  Given gold’s drop today, we will either buy in the AM or MOC today.  However, I  may also buy tomorrow MOC if gold drops further.  Right now it is down about $11 to $446, which is a considerable drop.  If you are buying as a hedge, you can buy today, if you are buying price, then $18 ish should be fine or XAU 96. [Xau went to 95.93!]”

7. HERE WE TALK ABOUT AFUND CLIENTS
We believe our client stocks HESG and IHITF are both likely to participate in the upcoming seasonable January effect for small and microcap stocks.

READER: I put orders in to buy on open ...Hesg, Tnxt, Uama on the open today 3k each....going on what you sent me...how long do I keep these for? ..
HW: There are two choices. First they are all January effect plays.  As such trades they can be sold or stopped in mid-January. As investments, they are all potentially capable of doing extremely well. Therefore, you could also sell 1/2 after a big move. I will be reporting on what I see again for these company fundamentals later in January.

READER: It does sort of make you wonder why it is taking IHI so long if ever.  Sort of makes you wonder what is not showing up in that Western astrology chart?
HW: Astrology is a necessary but not sufficient condition alone for success. What is highly unusual is its natal strength, which shows continual opportunities.  Hence, I believe over time, the odds continue to favor the company’s eventual success.

READER: Today you recommended IHI When I use that ticker in my chart system I get:
Information Hldgs Inc (NYSE). In you letter: International High-Tech Industries? The same ticker on two companies?
HW: Sorry IHI is the TSX symbol.  It is IHITF on the US bulletin board market.

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PAST WALL STREET NEXT WEEK REPORTS
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(c) 2004 All rights  reserved.  The Astrologers Fund  "Always a Stellar Performance"
wsnw@Afund.com 212/949-7211 Fax 212/949-7274 370 Lexington Avenue, Suite 416 New York, N.Y. 10017-6503
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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: PAST RESULTS ARE NOT NECESSARILY INDICATIVE  OF  FUTURE FORECASTING ACCURACY OR PROFITABLE  TRADING  RESULTS.

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IHI has been an AFUND client since 1994 and is currently paying monthly $2,500 consulting fees and $500 for banner ads on our website. May 15, 2002, an affiliated company, Susan Hahn & Associates became IHI’s media representative with a monthly fee of $1500.
May 17 2004 Health Sciences Group (HESG) became an AFUND client and is paying $5000 bimonthly in free trading stock for six months as a consulting fee.
Since October 13 2004, United American Corporation (UAMA) became an AFUND client  paying $2500 monthly plus 250,000 shares of free trading stock as a consulting fee.
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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