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

• Fall will be about China, the usual September/October market scares & the US Presidential Election.
• Many market cross currents - Best to trade big positional swings (buy dips/sell rallies) during August.
• America continues to be for Sale.
• Gold will benefit from demand from Sovereign funds plus new gold ETFs listings in Dubai, Hong Kong and India. Seasonal Buy August/early September as usual.
• We expect to see OIL $91 by/before Spring 2009.
• US corporate earnings by and large will not improve short term.

BOTTOM LINE:
Short term: We foresee another roller coast for the week ahead.  Wednesday’s oil report will be especially telling.  Unless Oil breaks its $110 support, markets will remain range bound.
Before the US presidential election, US markets are likely to retest/break their July 2008 lows!
To be continued. 

THE FOUR Henry (H) & George (G)  JULY 15/16 TRIPLE GOLD AFUND TRADING GEMS
H: Oil will drop $10 by this week then another $10 within two weeks on its way to $110 in August;
H: Buy Bank of America circa $20 - Sell at $34;
G: The US Dollar will immediately begin a major rally to as high as 78- already has moved from under 72 to 76;
G: Grains will drop 20% - Corn was 648 already 498; Wheat was 834 already 765.
When you reach for the stars, good things happen. 

GUEST HYDE PARK SOAPBOX: Recession-Plagued Nation Demands New Bubble To Invest In | The Onion
“WASHINGTON—A panel of top business leaders testified before Congress about the worsening recession Monday, demanding the government provide Americans with a new irresponsible and largely illusory economic bubble in which to invest….”
 

 
KEY DATES:    AUGUST 14, 15, 22
DJIA:                11400 SUPPORT 12800 RESISTANCE
SPX:                1300 PIVOT
NASDAQ:         2380 PIVOT
XAU:                140 SUPPORT
DEC GOLD:      $908 FAIR VALUE
XOI:                  1240 SUPPORT
SEPT OIL:         $121 PIVOT $110 SUPPORT  

The Market Marker Sentiment OIL ON THE BRAIN UNTIL OCTOBER 3!
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 1 UV; 7 offer 4%+ Dividends 5 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. “`Because of high oil prices, a weak housing market and a weak job market, the consumer is under unprecedented stress.''

Alec Young, equity strategist, Standard & Poor's

HW: And while this may be masked on and off until November, this condition will not likely disappear before 2010! 

“8/11/08 Due to many economic cross currents, The Dow can go slightly above 13,264 (its 2007 close) and/or slightly below 10717 (its 2005 close) before the November elections.  Like buying Bank of America (BAC) at 21 and 19 and selling at $34 there is a lot of potential profit to be had when you buy quality companies that are seriously undervalued and hold them for a good profit long term.  However, it short term you may 15-25% or more, lock in the profits by selling and take a profit or writing October calls. Currently we are thinking of accumulating for the long term (or short term) AIG in similar fashion circa $22 and again at $20 if given the opportunity….
To read more, WSNW subscribers should go to our updated post S: DOW JONES STOCKS (8/11) 

3. “The situation in gold is not very good. `A lot of people are saying if we break $850, we're going to $600.''

Mario Innecco, futures broker, MF Global

HW: If we break $850 we see $844, $833-$836. $810, $800 and/or $777 is possible, although if so, that is all. 

Our view: Gold is beginning an intermediate term basing.
Depending on if and how the US Dollar rallies to 78, and if and how Oil breaks $100, determines our next second, third and fourth precious metals buysl

As we and most analysts believe, Oil and Gold prices have to resemble each other more.  Yet as Oil has been dropping, we have slightly raised our Fair Value for Gold from $905 to $908!

Hence it is currently undervalued in our view.  Still, we do see a possible down side target of $833-$836, which would be another of four buys to be completed no later than the second week of September.

RE Our Wall Street Gold Alert 1/4 10.01 am 8/8/08:

Right now oil is dropping 116.55 and gold is down to 859.

While there is only a 30% chance this is a bottom, we like the prices of stocks such as NG $6,64 and AXU $2.85 and the GDX <37.25.  So while there is no rush (you have until MidSeptember), sometime later today can be our FIRST of four select gold stock buys.  As for gold and silver it can drop further to $838 or perhaps test and break $800 if Oil breaks $110.Still I feel comfortable with a first intermediate term nibble over the next few days.  This will be the first of 4 buys initially planned for the beginning of early June to early September.

We will be fully committed by midSeptember.

Note: We did our first new buys of Nova Gold (NG) at $6.55 on Friday.  But for our record, we always use closing prices which were $6.62 and GDX $36.30

4.  “It makes sense to me to get a rally off of the very depressed levels, but there are still these clouds overhanging the market. It smacks of a bear-market rally.''

Nick Sargen chief investment officer, Washington Investment Advisors

HW: I agree. In fact that is what we saw on Friday, is it not?

“These are volatile times. There’s a lot of moving parts here, and nobody can quite figure out how they all mesh. You’re hearing a lot of catastrophic predictions.”

Edward Yardeni, investment strategist

HW: Well that is because, like sex, it sell news.  Things are bad, very bad, but currently far from catastrophic.

“We're relatively bearish on financials because even when we get this crisis sorted out, the rebound is going to be muted. Everyone wants to declare the crisis over but it's going to take a long time to dig out of this hole.”

Ralph Shive, chief investment officer, 1st Source

HW:  True. It is only a question of WHEN and at WHAT price reality will be factored in.  Hence, it is best to trade financials short term. Buy a dream prices and sell as soon as it looks like most problems are over.

5. Looking for a Sign?: Scientifically (In)accurate Horoscopes: Scientific American

6. 25 Rules for Investors - Cramer's Mad Money

Why Every Investor Should Have a China Investment Strategy

Doomsday Warning From the Heavens 

7.  READER: You mentioned China as your short term major sale.  How about Hong Kong?  And their long term?
HW: We were bullish on HK for much of f H1 2008, but I have not looked for H2.
As for China, while the Olympics may provide support in August, the risk/reward in H2 2008 greatly favors more serious challenges ahead. 

READER: Nova Gold hit the target price of $7 today. is this the time to buy or what do you see as a good entry price now that gold is some what weak Thank you
HW:  This is a very good price for NG. It may drop another 1/2 point lower, and it may take until Mid September, but this is like buying BAC at 21-  you may be able to double up a little lower, but I believe you will make 50% and more later this year!  So yes, I think NG is a very good intermediate AND long term buy at 7OB. 
PS  MY target for NG is $12.50+ within 6-9 months!  Personally I think $16 is also a reasonable year end target given my forthcoming view of gold later this year. 

READER:  Can I ask your opinion on Oil. Do you think we have reached a bottom or has Oil further to fall this month?
HW: I believe short term Oil can go as high as $123-$125, and as low as below $118 to $110 as well. 

READER:  Do you still think $833 [Gold] is the good price for gold, or now at $850 it's a good time to buy?
HW: It is a good time to START to accumulate select quality gold stocks. As for physical gold, short term it may also be a good time to begin to accumulate. It may go lower this month (70% chance), but it may not. I believe it is ok to begin even here at $865.  I will buy more if gold drops lower, as I expect it higher in the Fall.