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

1. The Current Market Marker sentiment until July 4th is:

#1 Housing & Oil Worries;
#2 Commodities drop, Stocks rally; then Oil rallies;
#3 Stocks drop; then baby stock rally and Oil ignored!

Given the coming week’s Options Expiration coupled with an extremely active Astrological Week ahead: [Full Moon Wednesday, Mercury SD Thursday and Friday’s Options expiration on the Summer Solstice], we don’t plan any new major INVESTMENTS, but rather Day Trade or simply Stand Aside. 

We have a slight fundamental Bullish bias Short Term and a fundamentally Bearish bias Intermediate Term:
If Oil stays UP, the US will enter a serious recession. We think much of the current Oil mania will subside by the end of June with $126 and $135 a Ceiling, not a Summer Floor!
Hence until markets are above 12600, we are unlikely to reshort positionally, unless oil bases at $136 or reaches $142 and stays there past next Wednesday’s 10:35 Oil report..

Still, before November, we expect markets well below 12,000. In the meantime, we would only nibble at selective Cosmic Values and lock in profits at 15-20% short term.
We will mostly be trading ranges: we will buy if markets drop, and sell if they rise, but with no real commitment either way until July.
 

 
KEY DATES:     JUNE 18, 19, 20
DJIA:                11250 PIVOT
SPX:                 1360 PIVOT
NASDAQ:         2450 PIVOT
XAU:                 183 PIVOT
August GOLD:   875 PIVOT
XOI:                  1500 PIVOT 
August OIL:       135 PIVOT 125 SUPPORT 140 RESISTANCE 

The Market Marker Sentiment until JULY 4th is:  
#1 Housing & Oil Worries.
#2 Commodities drop, Stocks rally; then Oil rallies.  #3. Stocks drop; then baby stock rally & Oil ignored!
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:                      3~ FV 2 UV; 7 offer 4%+ Dividends 3 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. While we believe markets have bottomed short term, we also believe there is a high likelihood that they will be cheaper before October. Still, there ARE some undervalued stock buys, at least from a short to intermediate term perspective. Among the Dow stocks investments we are looking at Pfizer (PFE) and Bank of America (BAC).  Also Citibank may soon be fairly valued and close to a buy on the next bad news selling. 

We believe the US Dollar is currently Fairly Valued at .84, and in a trading range of .80 to .88. The Canadian Dollar is now Under Valued at $.97 and worth at least $1 to $1.02 US. Hence we are looking North again.
From an interesting viewpoint, we look for rich dividends (such as PFE, BAC & C), as well as currencies as part of our total return. 

BUSINESS & BANQUETS 
We enjoyed REIT Week 08 at the Waldorf Astoria.  Before 2010, we will again be buying REITS. Initially, these will not be Commercial, Hotel or shopping mall REITS which we feel are headed south, but mostly special situations such as Lexington Realty Trust (9% Yield) and HCP.(5% Yield). 

Note: REIT’s can also be as Sector plays, e.g. Entertainment Properties Trust (EPR) for Entertainment, Digital Realty Trust (DLR) for Computers & Technology, BioMed Realty Trust (BMR) for Biotech & Health Care, American Campus Communities (ACC) & Education Realty Trust (EDR) for Education.  We will be updating our REIT post sometime this Summer when we believe it is time to buy and the risk to principal is not as great as currently, especially for Commercial, Hotel and Shopping Malls.

"High oil prices are negating the economic impact of the stimulus checks and prolonging this period of economic and market stagnation."
David Kelly, chief market strategist, JPMorgan Funds 

"The dollar is going higher and commodities in general are being pressured lower."

Mark Waggoner, president, Excel Futures

“`I think that at about $80 the market crossed into the irrational exuberance level.  It's hard to find a rational explanation for the gain of the last six months.''

Michael Lynch, president, Strategic Energy & Economic Research

HW: I agree. The US Dollar decline nor long only pension funds is enough to explain the irrational exuberance in Oil today. 

“`What we have here is a situation where essentially higher prices aren't generating any more supply. `What we have to do is keep pricing the commodity higher until demand starts falling,'' which ``is around $150 a barrel.''
Paul Sankey, analyst, Deutsche Bank Securities
HW: I think $138 to $142 should do it, if so, we are there NOW! 

It may soon be time to BEGIN to accumulate precious metal stocks. I personally prefer to wait until Gold is under $840 and not above $875. However, given my view that these stocks will be HIGHER in the Fall & Winter, it is more ok to look now.  What to buy?  Begin to research the companies presenting at our July  Triple Gold Conference at the NY Yacht Club as well as review our Gold premium post which I plan to update shortly. 

4. `The real harrowing days of credit crisis are still in front of us and will prove more widespread in effect than anything yet seen.'
Meredith Whitney, analyst, Oppenheimer
HW:  CDOs, credit cards, car loans have just begun to fail. More soon! 

"The last period we had a sustained period of stagflation, the only way we got out of it was through aggressive rate hikes that shocked the system. The fact rates will have to go up is what people are worried about."
Peter Kenny, managing director, Knight Equity Markets
HW: It is needed! 

"Nobody is betting that the worst of the credit crunch is over.''
Jeremy Batstone-Carr, equity strategist, Charles Stanley Group
HW: 108 on the bonds is our first trading target and we are not there yet. 

5.  Pensions Picking Dollars, Shorted by Hedge Funds

Oil Rally Topped Dot-CO Craze in Speculator's Mania

Commentary | The fading of the mirage economy

6. READER: Re: Markets are at a critical point today. Don't short [Silver] too much. Buy at 13 or 14 then in Nov it hits 19 + again!
HW: Short term [Silver] I believe Silver is too high. I want to buy below $16. Ideally $14-$12 which could happen  should oil drop below $100 quickly. 

READER: Do you feel ^DJI can go to as low as 11300 by end July 2008? One South Korean Investment Bank is mentioning this level today on CNBC for ^DJI in the coming two to three months. At this level ^DJI ( 11300 ) is for sure in 'bear phase'.
HW:  Between your time and October, at least one more serious down test is possible to those numbers or lower.  If  Oil does go above $140 first, then it will happen sooner.  If not, most likely latter.  This is a very difficult market and unofrtunately best to  trade frequently! 

READER: What do you think gold is going to do short term?
HW: Down, UP, Down, Down, and then UP.
Bottom line:   I still think there is more downside risk, although ok to start slowly accumulating precious metal shares.  I don’t see any rush.