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

1. THE FED IS WRONG AGAIN ON INFLATION
Current low interest rates will bring inflation later this year- this is the gold bugs nightmare scenario/wet dream!
For long term peace of mind, we have recommended GOLD & at most very limited exposure to US BONDS.
 

Our Short Term DOW Trading Range is 7400 to 9600

Fair Value circa DOW 8550; NAS 1525; SPX 869 based on future earnings.

 
The New Market Marker is bullish - A Known Weak Economy; so what me worry? No! Buy.
Bull markets can start when markets do not go down on bad news because it is not new information or already priced in.
The BIG positive for stock markets is that bond yields and bank interest is increasing targeting 0%.
The BIG question for long term investors is whether the bottom is already in.  I do not believe so, although my trading partner does.
In my view, analyst P/E estimates are still too high still and are not likely to be accurate until April.
Hence, markets may or may not rise in the January earning season.  They could simply be tightly range bound. Thereafter, we expect several alternate UP and Down months.
Bottom line: To my view, it is still TOO early to buy and hold fully without plenty of cash on the sidelines. 

ASTRODATES
1/10 Full Moon
1/11 Mercury SR
1/19 Sun enters Sagittarius 5.41 pm ET
1/26 Solar Eclipse 2:55am ET and Chinese New Year
 

 
 
KEY DATES:    JANUARY 5, 9/12
DJIA:                8800 PIVOT SUPPORT 7800 RESISTANCE 9400
SPX:                  900 PIVOT
NASDAQ:        1650 RESISTANCE
XAU:                110 SUPPORT 135 RESISTANCE
FEB GOLD:       $912 FAIR VALUE
MAR SILVER    --> $12
XOI:                  1000 PIVOT
DEC OIL:          PIVOT 50 P2 $71 P2 76 P3 91 

The New Market Marker Sentiment is A Known Weak Economy; so what me worry? No! Buy.
2008 CLOSE:           DJIA   8876, SPX   903 & NASDAQ 1577
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:                       6 ~ FV 4 UV; 11 offer 4%+ Dividends 8 offer 5%+ Dividends.
THINK SWISS AND PRESERVE CAPITAL: FOCUS ON PROTECTING AGAINST DOWNSIDE RISK. 

2. MAJOR 2009 AVOIDS:  CHINA, INDIA, US BONDS.  

“The conventional Wisdom is that markets will test down in H1 2009 below their 2008 lows, then rally up in H2 2009 to…”
WSNW subscribers can read our fundamental & technical views of the DJIA at premium subscriber post S: DOW JONES STOCKS (1/2009). 

“Now instead of being energy Bears when Oil was above $110, we are NOW energy BULLS with Oil below $40.  Our upside Oil targets are…”
WSNW subscribers can read more at our premium subscriber post S:ENERGY (1/2009). 

“Medical IT, Stem Cells, diagnostics and personalized medicine will be profitable watch words in 2009.  
In 2009 Medical aesthetics will underperform as baby boomers retrench, although we expect to see continual growth in Medical Tourism. We also expect ….”
WSNW subscribers can read more at our premium subscriber post S: HEALTH CARE (1/2009). 

3. “Things are going to be a lot better next year than a lot of people think. The U.S. is going to print the dollar to get out of the recession and anything tangible, like industrial metals, is going to be worth more.”
Lars Steffensen, managing director, Ebullio Capital Management 

GOLD IS THE ANSWER
WSNW subscribers should also read our premium subscriber post S: MINING (1/2009).
 

4. "Everybody is going to watch the economic numbers looking for any signs that the consensus forecast is going to be right. So far the consensus is that the economy will start to recover in the second half of 2009."
Hugh Johnson, chairman, Johnson Illington Advisors
HW: I believe that is the consensus view for the US stock market.  However, THIS time is not likely to be a single dip recession.

"A lot of financial and economic damage has been done.  We're now going to see declines in business investment and exports, and I don't see a rebound in consumer spending."
Scott Anderson, senior economist, Wells Fargo
HW: Yes, THIS recession will last a lot longer than usual. 

"It's very difficult to be the candle in the hurricane, especially when the hurricane is still going. But I have full faith and confidence in the US economy and financial system."
Rich Yamarone, director of economic research, Argus Research
HW: You were wrong in 2008, and this “unbridled” optimism may also be misplaced in 2009. 

5. World Bank predicts global gloom 

 Bond Bubble Brewing
“Internet stocks and crude oil have nothing on Treasury paper. When this bubble bursts, it will be nasty.” 

 Is January Effect worth betting on this year? 

6. READER:  A friend of mine just told me that she has invested her entire (much depleted) funds in gold at $ 800.  Good?  Bad?  It's all she has left for retirement.
HW: Gold is the classic wealth preserver. Traditional Swiss thinking was to hold 5% gold.  For most of 2009 & 2010, owning 10-30% gold is not unreasonable. However, it is NEVER smart to put ALL your money in any ONE type of investment no matter how good.
That being said, gold can go as low as $750 next year and as high as $1200+.  Given their level of extreme fear, I would suggest a reduction of 50% in gold holdings. I would suggest she consider reducing/profit stopping her gold holdings 25% when gold is $922 and, 25% when gold is $1000. .Some distressed real estate holdings sans mortgage might be a good substitute midyear. 

READER: Congratulations on the SSRI call.
HW: How sweet is was/is! 

READER: Thanks Henry. I made nice profits on this forecast. [RE: WSNW ALERT DECEMBER 11: Markets may move 20% overall in next 7 days]
It contains three elements of which I like: 
1.A clear target
2. Forecast probability. My intellect is too low to understand your P1, P2 etc. 
3. Time until target.
HW: You are welcome. Unfortunately in Q1 2009, we will continue have to take our money and run rather than a relaxed buy and hold.
 

READER: NG just announced a PP.
From the recent trading pattern, I was wondering NG will do a PP. This is the worst outcome I expected, it diluted the company by 30% now and almost 50% if warrants exercised. NG will not have any financial issue anymore, but its upside is limited. Probably a 3-4 dollar now thanks to the dilution.
HW: First, at least the downside is now limited and the shorts will have to cover. There is nothing wrong with a Triple Play intermediate term, but longer term NG can/should do even better.
Fundamentally, Nova had little choice but to do a significant financing.  This gives them enough cash for Donlin, maintain their interest in Galore and evaluate bringing Rock Creek back on line and/or look at new opportunities.  Don’t forget, Nova has a stellar horoscope in 2010-2014.