900LL STREET, NEXT WEEK MARCH 24, 2008

FINANCIAL ASTROLOGY FOR THE SUCCESSFUL INVESTOR AND TRADER

1. MARCH MARKETS
2. UP STARS/DOWN STARS
3. GOLDEN OPPORTUNITIES
4. ASTRONUT
5. QUOTES
6. ON THE WEB
7. LETTERS 

1. MARKING TIME UNTIL APRIL EARNINGS SEASON
Given the lack of strong astrological indicators, we are mostly playing trading ranges. Shortly we will be moving from market neutral to slightly negative, WHY?
 

POSITIVES

• Quarter Close is “Window Dressing”
• The world didn’t end last week with Bear Stearns
• Tax Season brings even more cash on the sidelines
• Possible Double Bottom in place. 

NEGATIVES

• The Market Zeitgeist until May remains Worry and HEAVY RECESSION FEARS.
• By postponing and not addressing problems, they don’t disappear. They will come back again in 2010 and/or 2008/2009.
• Earnings Season ahead.

INVESTORS: DON’T RUSH; WHILE THIS COULD BE LIKE THE LONG TERM CAPITAL MANAGEMENT BOTTOM, IT MAY NOT!  NO NEED TO RUSH IF YOU WISH TO SLEEP AT NIGHT! 

 
KEY DATES:     APRIL 2, 7
DJIA:                12400 PIVOT SUPPORT 11700  RESISTANCE  S1  12500  S2 12600 12800
SPX:                 1325 PIVOT
NASDAQ:          2150 SUPPORT 2350 RESISTANCE
XAU:                 175 PIVOT
APRIL GOLD:    925 PIVOT R1 940 R2 950 R3 980 S1 900 S2 888 S3 880
MA7 OIL:          100 PIVOT S1 97.50  S2 96 S3 92 S4 88  R1 102  R2 105 R3 108 R4 110 

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:                      2 ~ FV 0 UV; 5 offer 4%+ Dividends 4 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.  8 High-Yielding Stocks for Income 

What about income from Dividends? Are most stocks offering a 5% yield today overvalued?  If you believe Dow 11700 is the H1 2008 floor, you can begin to accumulate intermediate term whenever you feel the overwhelming desire to buy.   Alternately, they can be bought for the fact that an increasing number of market analysts now consider dividend paying stocks defensive, safe havens. For more and our picks, please read our premium subscriber post:

S: DIVIDEND & INCOME 

STOCKS IN THE NEWS
Visa’s first trade chart:  10.15.25 am 3/19/08 100 shares at 59.68.
My first impression given only a quick look (subject to verification) V will trade up in August and much of Q4 2008. V will not do as well Q1 2009, and will have a tough Q4 2010 but a good 2011! 

3. “You have the stupid money coming into the market now And I think the smart money is beginning to get a little frightened about what the stupid money will do."
Jeffrey M. Christian, managing director, CPM Group
HW: Last week while correctly bearish on the precious metal sector and selling Oil and Gold, I was more than a little frightened. Could this mean that I am more than a little smart? :) 

In Q2 2008, we will lower our Gold Fair Value from 899 to $875 and are planning our first trading buys circa $858.
Aggressive positional precious metal shorts still open should be locked in Tuesday March 25 OCO $888 with appropriate trailing stops.
As for Oil, we remain BIG BEARS (on fundamental grounds) with OIL above $90.

4.  Precision clock traps atoms in light to keep time
US physicists have made a clock so accurate it will neither gain nor lose even a second in more than 200 million years.
HW: Given this plus the cheap US Dollar vs. the now expensive Swiss Franc, we think it is more than enough reason not to overweight Swiss Watchmakers e.g. Swatch [SWGAF].  See also Swatch Success Could Unwind In 2008 

An economy carrier is to be established by the Dubai government, based in Dubai and managed by Emirates, a state-owned airline.  According to Bloomberg, the new airline has been set up by Sheikh Mohammed bin Rashid Al-Maktoum and is to be led by Ghaith al-Ghaith, the commercial operations director of Emirates.  Interestingly enough, this story appeared JUST before Oil record drop. Coincidence? I think not! 

5. "This whole market is driven by fear right now. Investors are thinking more and more this will be a long and drawn out recession, and that pulls down commodity prices and energy prices."
James Gaul, portfolio manager, Boston Advisors
HW: I guess you can’t fool All of the people All of the Time. 

"This will be the bottom. We got an incredibly aggressive Fed and three to five years from now, we will realize that this was the start of a bottoming process."
Mark Zandi, chief economist, Economy.com
HW: If so, sadly this is another LTCM type bottom. 

“The last time an opportunity of this nature existed to buy bank stocks this cheap was in 1990.  There will be more negative developments but they will be meaningless.”
Richard Bove, analyst, Punk Ziegel
HW: Meaningless?  Maybe, Maybe not!  I don’t intend to hold my Citibank bank 16OB  OCO late April buy for very long. Just through May OCO 25% and then run!

6. Fear Factor Alive for Wall Street
"It ain't over till it's over," Yogi Berra once said. Many worrywarts seem to be relating to today's ulcer-producing stock market environment in the same way.

What does stock market say about the real economy? 

US Stock Volatility Climbs to Highest in 70 years, S&P Says
HW: Whew! I thought it was just me! 

 6. READER: My personal favorite rule for traders is rule #4. IMAGINE THAT YOU ARE PLAYING A GAME IN AN INSANE ASYLUM.
HW:  Yes but my least favorite part of trading these days. 

READER: You mention bearish on gold and oil.  (Obviously great call)  Then you mention short today's rally.  Is the rally you are referring to a stock market rally, or are you anticipating a rally in gold and oil.  Just a little unclear on the comments.  Thanks.
HW: In our Daily Market Commentary I was referring to selling Gold, Silver and Oil while the stock market itself would rally today. Fundamentally at this time, we are bearish on gold above 899 and Oil above 95. 

READER: Totally amazing call on your part to sell gold! Do you think it will go to $850? Is there a good buy right now?
HW: My first target is 888 then 858 next.  I would not buy today. Gold can be down Sunday/Monday especially given these are holidays.

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