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We have long said that investing in the US in 1998 is like investing in HK in 1997: March/April 1998 ~= July/August 1997!
With a possible market top set in place on 3/25, others will see our vision as the market looks to support first at 8400, 8000 and then 7500. And then?
Watch if DJIA 8888 ceiling holds, and if Microsoft continues in a down trend from the selling on "good" news Wednesday.
What is the end result of a market that is no longer technically strong, but fundamentally weak? What will happen as more corporations start to report negative earnings surprises? A stealth depression! Feeling good about the US Stock market and economy? Read on!
1. Corporate profits among S.&P companies will rise just 1%, far below the 15.1% first quarter last year, the lowest rate since 1991 recession (Saturn/Neptune). GOLD: Most likely, our April Stock of the Month pick will be a gold stock with a 12 (instead of 6) month window to reach the 25%+ target. Since our first choice PGU has already moved, we may choose Campbell Resources (CCH) another one of Carol Mull's (FAX 371-353-6246) picks this month. This NYSE stock trading ~ 1/2 is a good risk/reward "non-exipiring option" similar to our previous SSC Silver recommendation ~ 3/4 OB.
IOMEGA (IOM): Long one of our favorite shorts, IOM, is now on WATCH for an intermediate term buy. Of course, not to rush and NOT before a retest of 52 week lows. We may consider buying if under 5 for intermediate term move to 6 or 7 by the Fall.
Which is better? Index and be happy with negative results going forward into 1998 that will be greater than most professionals or buy stocks carefully selected according to Cosmic Value Investing criteria? Hmm tough choice! :)
3. "Risk reduced" TRADING
Astrological timing, even when wrong, gives a trading edge. It provides a TIGHT time window and hence minimum time premium loss. For example, if short term trading in the stock index futures, you can prequalify the days with an increased likelihood for breakout potential, our KEY DATES +/- one day.
4. At the last SIRE meeting in NYC, Philip Roth, one of the world leading technical analysts and former MTA president, described a Bull market as "when fundamental analysts are wrong by UNDERestimating corporate profits", while a Bear market would be "fundamental analysts are wrong by OVERestimating corporate profits! " :) By next Tuesday, we will be posting the Roth Rules on the SIRE web site section. Rule number 1:
The mistake fundamental analysts make is in thinking stocks and companies are the same.
The mistake technical analysts make is in thinking stocks and companies are different.
5. Q: What is the "taurocidical coup de grace"?
A: Assume it has to do with a market correction by May (Taurus).
Internet Relay Chat: go to IRC Server at /server us.undernet.org 6667 then join channel #daytraders. About 250+ daytraders in real time "trading strategies" chat during market hours. If you need the chat share ware its at CHAT Day traders Site is at DAYTRADERS
HW: Haven't checked this out yet, but passing on to my readership.
I need some advice on a cover call strategy I'm doing as a hedge. I bought a Canadian Hi-Tech, a very good growth story and good management. I went in @ $38 and wrote a July call Now the stock is up to 52. I intend to hold this stock for long term, although I wouldn't mind taking profit. But it looks like my cover call strategy didn't work very well and I'm stuck until July for 30% less profit. What should I do?
HW: I can't give individual advice in the capacity of a newsletter writer. However, I ask what was your entry and exit strategy BEFORE you wrote the call? My best advice is to follow it! Other than that, I would hold and review your position in about a month as I am rather negative on most technology stocks for the month of Aries, unless there is very positive stock specific news before then. Thereafter, use a trailing stop to buy back the call if you want to hold the stock longer term. Who knows? Perhaps you will get lucky and the market will crash.
Q: Would you please provide an explanation of why the forecasted drop in the stock market has not taken place. You wrote earlier that the influence of the lunar eclipse lasts as much as a month, but you obviously thought that the effects of the eclipse would already have occurred. Does the current behavior suggest that there might be a stealth planet or two wreaking havoc on astrologers' predictions (I'm being serious here!)?
A: The Astrologers Fund prefers to be early rather than late: our motto is "Be there first." The March eclipse did stop the market's momentum briefly. As long as March/April 1998 US = July/August 1997 HK, I see no need to prepare a star wars defense against stealth planets.
Q: What astro event would prevent the Dow reaching 10,130 by mid May? I feel we're in a major blow-off. I've failed in taking advantage of it this month past though. I think mid to late May may be the beginning of the end. What do you think?
A: April 2nd Mars/Saturn or Clinton's Saturn-Moon aspects this May could reflect unfavorable stock market pricing. I believe we probably have seen the top. Hallaleuah!
Q: When you said "Note: If more reporting of poor corporate profits is NOT enough to kill this Bull, then May's Saturn/Neptune becomes our next choice to decimate the gambling sector, aka stock markets." did you mean the square Saturn/Neptune aspect which occurs on 25 June?
A: Yes.
Q: Please let me know the date you use for Dow-Jones I enjoy your weekly letter and just recently bought your book. Great stuff. Thanks.
A: I use the latest DJIA date, the Oct 6, 1997 CBT futures and future options contract launching.
Q:I am really getting a little bored with IHI. Still have considerable number of shares which have lost value over the last 2 years. Are you still so Bullish on them? Or should I take the loss?
A: Why sell with good news of late? I believe it is crazy to sell IHI ahead of the factory opening this summer. IT IS OUR MARCH STOCK OF THE MONTH PICK - minimum target 50%+ by Fall.
However, if IHI does not make it by December, THEN it could be right to consider taking a tax loss and saying good bye. As of today, I would consider buying and adding to your position (average down), but MOST DEFINITELY, I do not advise selling at this time.
PS Bored? Dont you enjoy watching the grass grow on a sunny summer day? I do!
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Wednesdays, listen to our ABS radio program TRADING BY THE STARS.
2. Wonder just much the US owes? Check out US NATIONAL DEBT or TO THE PENNY.
3. US Trade Deficit at the highest level in a decade and GROWING.
4. More American filed for bankruptcy in 1997 than ever before - more than 1.4 million up 19 percent and we forecast 1998 will be another record year.
5. Everything suggests that inflation is building up but being concealed temporarily by a strong dollar. That won't last as long as most currency traders believe.
6. How about the lie that the US federal budget is "balanced," without also mentioning that Social Security payments are counted as "income" instead of deposited in a trust fund?
7. You think there is little unemployment? How about our continuous UNDER-employment? THAT IS THE REAL STEALTH DEPRESSION.
NEXT WEEK:
Morgan Stanley economists are predicting a Federal Reserve interest rate tightening at their next meeting Tuesday.
OPEC emergency oil talks about restraining oil production to again raise prices.
BEST RISK/REWARD: Bear for a day, a week, a month....
Key dates : March 31, April 2
DIJA: S1 8400 R1 8800 R2 8844 R3 8888
(c) 1998 All rights reserved. The Astrologers Fund "Always a Stellar Performance"
wsnw@Afund.com 212/949-7211 Fax 212/949-7274 350 Lexington Avenue, 4th Floor New York, N.Y. 10016-0909
Author: INVESTING BY THE STARS McGraw Hill, TRADING BY THE STARS (99)
May 15, 1998 Sixth Annual Astrology & Stock Market Conference NYC
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OF FUTURE FORECASTING ACCURACY OR PROFITABLE TRADING RESULTS. The Astrologers
Fund Accepts No Liability Whatsoever For Any Loss Arising From Any
Use Of Its Report Or It's Contents. The Astrologers Fund Or Its Clients
Usually Holds Positions In The Stocks and/or Market Instruments Mentioned
And May Buy Or Sell At Any Time Without Notice. This Information Is In
No Way A Representation To Buy Or Sell Securities, Bonds, Options Or Futures.
This information is not intended to be used as the sole basis of any investment decisions,
nor should it be construed as advice designed to meet the investment needs of any particular investor.
ALWAYS CHECK WITH YOUR LICENSED FINANCIAL PLANNER OR BROKER BEFORE BUYING
OR SELLING ON THE RECOMMENDATIONS OF THE ASTROLOGERS FUND.