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

1. FOMC – BLUE SKIES AHEAD?
Assuming that our June 12th Market Top holds - Dow 8799 SPX 946 NAS 1858, we are likely to recommend an appropriately stopped positional short by Thursday MOC.
However, we have stronger negative astro later in July to September.  Until then, we are more at the mercy of news, Fed Market interventions and waiting for the July earning season which Alcoa (AA) begins, slowly but perhaps dramatically timed to the July 7 Lunar Eclipse! 

With the possible exception of financial stocks, most earnings are expected to be poor. Questions:  are analysts too optimistic or pessimistic regarding earnings, and what will the forward looking statements be like? 
While there are astrological reasons for rose colored glasses to continue given the mundane effects of the Jupiter/Neptune conjunction, it is only a question of when by/before September stocks markets correct back to Dow 8000 and more.
Our investing advice remains to be stay mostly on the sidelines with the exception of compelling special situations. 

GUEST HYDE PARK SOAPBOX Why Inflation Isn’t the Danger
“The Fed has carried out a string of big moves to fight the recession, and seems fully capable of unwinding its measures when the recovery begins.”
HW:  I don’t disagree that the Fed is “fully capable” of many things.  One of them was AVOIDING the current Great Recession instead of facilitating it. Hence I plan to keep my intermediate term precious metal/hard asset hedges. 

 
KEY DATES:     JUNE 22, 26
DJIA:                 8500 PIVOT  RESISTANCE 8776
SPX:                 900 SUPPORT? 934 RESISTANCE
NASDAQ:         1800 PIVOT
XAU:                 133 SUPPORT 150 RESISTANCE
AUGUST GOLD: 930 PIVOT 900 SUPPORT 960
SEPT SILVER:   14 SUPPORT?
XOI:                   930 PIVOT
DEC OIL:           72 PIVOT 67 SUPPORT 78 RESISTANCE  

The new Market Marker Sentiment has Less Volatility and Market Cross Currents.
Stocks Meander slightly ahead and favor defensive plays. The US$ doesn't collapse and Commodities may not be needed as a safe haven panacea.
2008 CLOSE:           DJIA   8776, 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
DJIA:                       8 ~ FV 3 UV; 7 offer 4%+ Dividends 5offer 5%+ Dividends.
THINK TRADITIONAL SWISS AND PRESERVE CAPITAL: FOCUS ON PROTECTING AGAINST DOWNSIDE RISK. 

2. Agriculture weathering economic crisis better than other sector
“Since food is a basic necessity, the agriculture sector has taken less of a hit than other industries as a result of the current economic crisis, according to a new report by the United Nations Food and Agriculture Organization (FAO).”
Note: In our proposed new Five Element Fund, this sector will be over weighted post the next market correction. 

3. What contrarian analysis says about gold
HW: I find this a weak argument. 

Technically, short term gold may be range bound $900 to $990.  However, we will not be surprised to see Silver test $14 again and long range support $13.50 to $13.80 next week.
This largely depends on the US Dollar and to a lesser extent US bonds, rather than Silver or Gold fundamentals.   Again, short term, we see the US Dollar fairly valued and range bound from .78 to .83.
Bottom line: In the absence of surprising and negative geopolitical news, we are playing precious metal seasonal strategies, i.e. a modest short bias. 

4. “Equity valuations have gone from exceptionally cheap to neutral territory. For the rest of June, we’ll probably trade sideways or give up some of the gains. There is a serious concern, justifiably so, of a number of constraints on growth recovery going into 2010.”
Bob Parker, vice chairman, Credit Suisse Asset Management
HW: I agree, except rather than being in neutral territory, I see valuations as slightly/somewhat overpriced. 

 “I wouldn’t be surprised if what started yesterday is the beginning of a correction that goes on a few weeks.”

Jim O’Neill, chief economist, Goldman Sachs

HW: Neither would I. 

“The worst part of the economic decline is behind us. The economy is still contracting, but is likely to bottom out in the second half of the year and a “gradual” recovery will begin.”
Scott Brown, chief economist, Raymond James & Associates
HW: I believe you are ignoring the probable effects of astrology on markets post the July 22, 2009 Solar Eclipse. 

5. U.S. bounce up for grabs 

The Bear Market Never Ended 

Why higher interest rates are coming 

6. READER: Are you still suggesting holding off on buying gold and oil for an investment or more than short term.
HW: You are referring to fresh purchases, I presume.  If so,  that remains my belief for June. 

READER: Do you think Gold will reach $1500 as John Embry predicts?
HW: No. 

READER: It looks like Thursday may have been an interim bottom in the mining stocks, metals, and oil.  But, I am skeptical that it is straight up from here and have not put cash on the side lines to work yet. I am letting core positions rise instead this Friday. You said there were perhaps two downturns coming before the end of June.  I assume we have seen one. Please clarify when to buy in this weekend’s newsletter.
HW: I am NOT planning on buying in June, unless there is a very surprising FOMC or geopolitical event.