1. FEBRUARY MARKETS
2. UP STARS/DOWN STARS
3. GOLDEN OPPORTUNITIES
4. QUOTES
5. ON THE WEB
6. LETTERS
Regardless, today’s markets are best
viewed as a “Market of Stocks”, not a Stock Market:
ONE
WINNING INVESTING Strategy: Look to stocks with recent good news and/or
guidance and have rallied strongly on that news. Then try to buy those stocks
close to their pre-news price.
Alternately, place buy at your first
choice long term stock holdings at Value pricing. However, save
plenty of cash in case there is panic selling and prices are actually cheap and
not just at value!
FASHION
AND MARKETS
[is] Alexis Mabille 31, with
his sporty, boy-and-girl take on lacy blouses, silken rugby-shirt dresses and
craftily tailored pants, really joining the historic ranks of couturiers from
which Valentino had just bowed out?
"No season, no reason -
autumn, winter, spring, summer, him, her, you and I" read the program
notes for Mabille's heady cocktail of airy volumes with graphic high-waist
trousers.
MARKET TRANSLATION:
It is a market of stocks, not a stock market.
Add clutch bags adapted from
the bow ties with which he started his career.
MARKET TRANSLATION:
Continue to be conservative and protect principal.
The designer Riccardo Tischi
has a vision — delicate, graceful and youthful. And he would have presented a
fine Givenchy show had he not used styling tricks like eyebrow brands and
wrinkled leggings, more suited to ready-to-wear.
Yet Tischi is bringing to
Givenchy a certain off-beat elegance, as championed by French Vogue and by its
editor-in-chief, Carine Roitfeld. The models seemed to have been cloned from
her image, with their straight curtains of hair and haute high platform shoes.
MARKET TRANSLATION:
BUY IPOS IN EMERGING MARKETS AND MARKET SECTORS.
The show was played out almost
entirely in black and white, with touches of dawn pink, aqua blue and absinthe
green. A scarlet dress that opened like a concertina looked more experimental
than realist.
MARKET TRANSLATION: BUY
OBVIOUS WINNERS AND SELL OBVIOUS LOSERS.
A mix of seasons and genders
and the insinuation of autumn ready-to-wear summed up the spring/summer 2008
couture season.
MARKET TRANSLATION: BULLS
can win, BEARS can win. Be prepared for anything and everything
Guest
“To my astonishment, he [Ben
Bernanke] seems to think the purpose of the Federal Reserve is to bail out a
few investment banks on Wall Street and the stock market. This is a very
dangerous and serious situation.”
Jimmy Rogers, chairman, Rogers
Holdings
HW: I agree that these rate
reductions are “only making things worse by weakening the dollar and boosting
inflation”. Sadly, the market is priced
for 100% odds of a 50 basis-point cut occurring at the Fed's March 18 meeting.
TRADERS: It is possible that this may the first
Options Expiration in a while that will be less volatile than the previous
week! Still Bulls and Bears will
continue to fight and while we will continue to bet with the Bulls we are not
forgetting the NEW market Zeitgeist is “Worry and HEAVY Recession Fears” until
May.
Note:
We believe NASDAQ remains a positional buy past
INVESTORS:
Bear
necessities asks when will the stock market become a buying opportunity? We think it will present several 10% opportunities:
One was January 22, another was the week of the February 6thth Solar
Eclipse.
My long
term view is well known: focus on protecting against downside risk.
KEY DATES: FEBRUARY 20
DJIA: 12200
PIVOT R1 12400 R2 12500 R3 12650 R 4 12800
SPX: 1325 PIVOT
NASDAQ: 2331
PIVOT
XAU: 178 PIVOT 170
SUPPORT R1 184 R2 196 R3 200
APRIL GOLD: 900 PIVOT R1 930 R2 840 R3 950 R 4 964
MAR OIL: 92 PIVOT S1 90 S2 87 S3 86 R4 81 94 RESISTANCE
New Market Marker
Sentiment is: Worry and HEAVY Recession
Fears.
DON’T BUY AND HOLD: BE
LIQUID WITH A
BALANCED AND DIVERSIFIED PORTFOLIO!
2007 CLOSE: DJIA
13264, SPX 1468 & NASDAQ 2655
2006 CLOSE: DJIA
12463, SPX 1418 & NASDAQ 2415
2005 CLOSE: DJIA 10717, SPX 1248 & NASDAQ 2205
DIJA:
4 ~ FV 0 UV; 4 offer 4%+
Dividends 1 offer 5%+ Dividends.
Looking ahead,
my question is whether 2008 will show less than 2% growth or be a classical
recession?
THINK SWISS AND PRESERVE CAPITAL: FOCUS ON PROTECTING AGAINST
DOWNSIDE RISK.
2. Given our view of
markets, we suggest reviewing all financial stock holdings. Last week, we
downgraded Bank of Montreal (BMO), primarily due to a poor personal experience
which made me question their near term growth potential. According to “Roach” Market Theory, when one
roach is seen, hundreds more are probably lying around unseen. In today’s scary markets, I don’t believe it
is prudent to take unnecessary chances. Hence if you own BMO, we recommend doing
your own due diligence and consider substituting another Canadian bank depending
on which portfolio allocation BMO belongs to:
For most, we would
substitute Nova Scotia Bank (BNS), despite it lower yield (4% vs. 5%), it has
outperformed in the both the last year and two year period and we expect this
to continue. For others, Royal Bank (RY)
or where BNS is already owned, is a good choice. Again RY has outperformed BMO over the last
one and two years periods and we also expect this also to continue. We also now are reviewing Toronto Dominion (TD)
[3.5% dividend yield] partially due to its recent purchase of Commerce Bank
[CBH] which is one of my
Given recent price
action, Thursday and our short term NASDAQ bullishness, Thursday Apple (AAPL)
became a February Platinum short term buy under 122 with a price target of
135-145. However, we have yet to do the
astrology, so we have no comment medium or longer term at this time.
3. We were pleased to see gold selling under our
Q1 2008 valuation of 895 last week.
Early this week, we have forecast another rally to test its all time
high. However, we are not yet betting on
$1000, and only see $963-$965 at best, and perhaps not yet that high.
Still,
all gold lovers can only appreciate the recent Congress giveaways, aka stimulus
package, as a boon to owners of the yellow metal.
Let
us consider the gold bear case. “Gold will next drop to test $850-$875, and let’s
be generous, $825, 800 and even $780. So
what? Look to bankable feasibility
studies- they currently average $600 gold and clearly should be raised to $666
or higher.
Given average costs are
$350-$450, that represents quite a tidy profit. More important, many quality
junior miners and explorers are already trading at highly discounted levels,
closer to multi-year bottoms than tops. Will they not jump for joy
and rally 1) upon a major discovery with a 100X not 10X “junior jump”, 2)
Continued M&A action and/or 3) Gold
reaches $1000 later in 2008?
But if you are a positional
trader and not a long term investor or hedging with gold, then expect
heightened volatility near term as with so many markets. Both short term
trading bulls and bears should exercise caution and meticulously manage trailing
profit stop strategies.
4. “That's
staggering. P/Es below 12 are typically associated with stock market bottoms.''
Thomas J. Lee, chief
HW: Stock valuations
for the-third of the S&P members trading below 12 times reported earnings
ARE attractive, but NOT compelling buys.
“There's going to be
more write downs, more problems. It's hard to navigate a market like this.''
Quincy Krosby, chief
investment strategist,
HW: Without an
astrological map, it must be very difficult.
“The least we can say is that we live in interesting
times. That’s about the only positive thing I can say.”
Jean- Claude Juncker, Finance Minister, Luxembourg
HW: How about “gold is good”?
Oil Crisis Will Lead to 10-Year Financial & Political
Crisis
HW: Scary possibility.
No Bond in Bonds
6. READER: I believe we
need some consolidation but likely have a strong move starting in Aug 2008.
FYI: We will be trading long gold ahead of 2/10 :)
READER: Silver
to outperform gold – I don’t know the fundamental reason but the chart suggest
silver goes to US$25/oz.
HW: Yes with
$1200 gold by or before 2011, $25 is a reasonable and an oft quoted
target. But I don’t believe this is a
reasonable target for March [2008] Silver!
READER: [Your buys of last week] This is very interesting.
Do you still have a turn date for tomorrow? My next turn date is around
the 10th and I am assuming we could rally into that date and then decline into
later this month. We are getting close to where we could have a monthly
and weekly VIX buy signal -- not yet, but the set up is there. We are in
the extreme area in one of my indicators, so I would expect a rally -- that is
why your comments below got my attention. The last extreme I had was
1/25. Do you still look for a reversal overnight or tomorrow?
HW: We are within two days of the Feb 6th
10:44pm ET Solar Eclipse. That can be a tradable bottom and favorable R/R bet,
albeit with high risk and volatility.
READER: Pls use the rally in ^DJI to 'square off'
your longs or one can safely go 'short'. This relief rally will not last.
You mention:
“We also believe Oil will drop to $80 before the end of February and this will
slow gold's rise.”
As per my
calculations and predictions - Crude Oil will do not drop to US $ 80 pbbl
by end Feb'08. Prices may dip to sub $ 86 levels but will rebound to US $
90+ levels.
I am very bullish on Crude
Oil for the long term. US $ 180 pbbl is the target for end 2010.
HW: Clients should have made lots of money on our
two Oil shorts and we plan another one again shortly for our Australian trading
group’s February end date target of $80.
READER: FYI-the
Elliott Wave patterns allow ideally for a retest of 1/22-1/23 lows (mostly in
NDX) and then a strong tradable rally.
HW: Yes, a possibility, and noted.
READER: I think my favorite
forecast of yours is 1000 dollar gold being the catalyst for all these
undervalued jr's.
Bravo
on your oil and gold call short term. Oil looking like its headed for 78 bucks.
At which pt it will be a massive buy.
HW:
Yes, but markets, especially today do NOT move in a straight line!
READER:
Re: your Friday February 8th WSNW email alert:
Friday
February 8 We expect a modest positive market today. However markets have been
vicious and dangerous so beware as all week!
There
is a 75% chance GREAT TRADEABLE bottom in place. It is the other 25% that
is still dangerous!
9am
update.
PLAY IT
AGAIN SAM. WE ARE BUYING THE MORNING AND BASICALLY COMFORTABLE INVESTING
AND POSITIONAL TRADING LONGS.
GOLD
SHOULD DO NICELY SUNDAY NIGHT WITH A POSSIBLE RETEST OF THE 940 EARLY NEXT WEEK
DESPITE ABUNDANT PM BEARS.
We
expect markets to “calm down” next week somewhat and will stop with our daily
alerts except for GOLD and Platinum WSNW subs.
That
was cute. The 25% is still dangerous.
HW: You
betcha!
"Can you afford NOT
to have financial
astrology in YOUR future?"
Stop reading Wall Street, Next Week, last week: YES, I WANT TO
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