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1. HOLIDAY AHEAD
2. 1998 UPDATE #1 GLOBAL INVESTING
3. TRADING
4. FINANCIAL ASTROLOGY
5. LETTERS
We are off early for a nice long weekend, and will be closing trading positions accordingly. Pre-holiday Fridays often allow for exaggerated market moves that can quickly be corrected on Tuesday. We will reenter shorts above 9200 if provided the opportunity.
Attention Investors: You still have some time before the summer to raise cash, but do you really want to be the last one out of the door? DO NOT fail to read the SIRE post by Samuel Robbins referencing his May 19, 1998 NYC meeting talk. Remember he correctly forecast the 17 year bull market starting in 1982!
NOTE: The Indonesian situation has just started and it is far from over. Suharto is out this week as Rebecca Nolan and myself forecast, but the problems remain and in some ways are worse. Who there can impose the fiscal discipline the IMF demands? Eventually, big lenders like Chase and Tokyo-Mitsubishi Bank will HAVE TO ACCEPT REPAYMENT IN A DOLLAR FOR RUPIAH SWAP.
KEY DATES: May 25 (26)
DJIA: S1 8800 S2 8888 S3 8991 - R1 9050 R2 9170 R3 9230
2. The following 4 part series is abstracted from AFUND reports highlighted at our 6th Annual Astrology Stock Market Seminar in New York: Global Investing (1), Marketing Timing (2), Sectors (3) and Stock Selection (4)
THE HOROSCOPE A MAP OF TIME AND PLACE - here is a brief overview of some of the world markets we cover:
ASIA Trading and long term investment opportunities
INDONESIA - Too MANY problems short and intermediate term. Hedge funds can trade the Rupiah to a -9000 fix.
JAPAN - Mixed. We like the Yen at 135 OB, and exporting and construction companies.
HONG KONG - Like long term and select red chips but AVOID the property sector. Currency devaluation coming c.f. Drachma/Greek market surge. So Hong Kong Webs EWH under 9 after 5/26 or July options with currency hedge.
KOREA - Korean Won currency stable, key companies will survive and prosper.
EUROPE Relative bargains, Euro not a strong currency in 1999, especially midyear.
ITALY - Continued out performer rest of 1998 but many European charts, including Italy's show a potential problem circa summer 99 eclipse. Exit well before then.
HOLLAND - Replaces Italy as our "favorite country" in 2000.
NORTH AMERICA
CANADA - AVOID, a disaster as early as this Summer/Fall to late 1999.
1)Canada's horoscope indicates a large PROBABILITY for a currency/economic/ political crisis due to the Quebec problem. The Canadian dollar will continue to fall.
2) Natural Resources are in the toilet. Over time we plan to buy at bargain basement prices. We believe in the CONTRARIAN PHILOSOPHY of "buying when others selling and selling when others are buying".
UNITED STATES - Overvalued and a ticking bomb without a healthy correction (reality) before May 2000. Beware when the US dollar is no long THE safe haven and it has competition from ECU and even GOLD.
AFUND COVERAGE Forthcoming:
ISRAEL - Positive, especially software and hi-technology companies.
NORWAY - Oil rich and may avoid some ECU problems.
SINGAPORE - Will selectively benefit from Asian situation; intermediate term buy later this year e.g. cash rich Singapore telecomm. (SGTCY).
CUBA - Coming sooner than you think: Hotels/Resorts and prime real estate.
3. SHORTING IDEAS: CMB, CPQ, MSFT, TMX
CMB: CHASE MANHATTAN BANK - ~146 ceiling and we expect at least 1 Billion $US write off in Indonesian. You can hedge selling against a stronger bank or Banking index.
CPQ: COMPAQ - Short term sell to 27, 25, 22 or ? Long term buy.
MSFT: MICROSOFT - Willl lose its case against the Justice Department.
Note: HWP - Hewlett Packard will continue to under perform, but better risk-reward elsewhere
TMX: TELEMEX - A long term favorite short coming home to roost.
TRADING BUYS: MOT
MOT MOTOROLA - 52 ideal trading buy, but 55 ok as either day trade as this past Thursday or as a long term investment.
FIRST TRADING WATCH: OIL (to buy); BONDS (to sell)
4. We are always delighted to find new and serious financial astrology web sites. We just discovered COMMODITY CYCLES which combines astrology and technical analysis in the Commodity markets. While I have not yet studied the contents posted there, I can vouch for the underlying premise - that astrology is an essential part of commodity and ALL financial markets.
5. As you know, I am a subscriber and have been very pleased with your current work. I wanted you to know how much I appreciated your HWP call on 5/13/98 and I enjoyed Lukman Clark's article on Indonesia. It was excellent Thanks for keeping us informed about world events.
HW: Thank you.
Q: H. did you note Indonesia problem exact with Saturn on Suharto's south node?
A: :)
Q: Any opinion of MO? Is it now near a bottom?
A: We are near a P1 bottom, so a technical bounce from 35 is possible. However, MO has more problems ahead this Summer. Why the rush to buy before the summer for 2 or 3 points? However, if you are short the stock, you could place a close stop, or a long trade can be entered also with a tight stop.( NOTE: This already happened with a low at 34 3/4). But MO can easily still fall another 10% below 33 to a P2 position and I would prefer to sell rather than buy this one. Again, I ask: "what is the rush?"
The UIT performance should be better documented. e.g., you must announce all stocks at the same time and start entry prices as of a certain closing date for the entire portfolio. This avoids uncertainty in the customer's mind when you make comments like "we bought Oxford at ...." I am wondering - now did he buy that at the same time he bought all other securities in his UIT or was that an aggressive trade entry - if so the performance numbers can't be substantiated in my mind. As with the May UIT - one can't have a May UIT if the investments aren't announced on April 30 - And do you stop tracking the Jan UIT when May takes over? or what exactly is the sequence here?
A: For tracking purposes, we bought all at the end of the next trading day. We publicly announced the May UIT at our 6th Congress, so we began May 18th. However, it really doesn't matter as the point is OUT PERFORMANCE using Financial Astrology, in this case the intermediate term. As to the January UIT, it reach 25% its 12 month target (if cashed out) and more in May. But we are holding for 12 months to demonstrate it will continue to outperform. This past Thursday, our May UIT was already up over 2%, already paying my 2 % fee!
Well, another psychic has come up empty in their forecast of a big move downward in the market. Your reader whose partner, Dorcas, forecast a 1,000 pt. move downward in the DOW today struck out on this one. It's looking like the market will be heading northward again shortly, n'est pas?
HW: Short term yes, BUT ONLY IF YOU "DANCE BY THE EXIT". I prefer to see this is as yet another profitable opportunity to sell.
"Can you afford NOT to have financial astrology in YOUR future?"
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(c) 1998 All rights reserved. The Astrologers Fund "Always a Stellar Performance"
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Author: INVESTING BY THE STARS McGraw Hill, TRADING BY THE STARS (99)
May 15, 1998 Sixth Annual Astrology & Stock Market Conference NYC