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1. Weekend Shorting
2. Chris Bearish
3. Letters
1. We held most of our shorts over the weekend, both in the bond and stock markets. Without 2nd Qtr window dressing (the higher the market is on June 30, the bigger the take home bonus for many money managers), the market might well have closed at 7600 or below. Next week we have the July 1-2 FOMC meeting, thereupon we have July earnings season. We believe they will be poor and help facilitate a 5%+ down movement. However, I am wary that July 2 may be problematic for me personally, and therefore may close a number of shorts Monday or Tuesday. If however, there is another rally this week (it is a short holiday week and traditionally bullish) we simply re-enter shorts near DIJA highs or July 3 or 7. PAY ATTENTION TO JULY 3, the day before the New Moon which should give key directional clues to the July market.
2. We are delighted that Chris has turned bearish on World Short Day. Nice to have the market betting on our side. See CADBURY NUMBERS on our website.
3. ...My main reason for emailing you is about HONG KONG.....Can you please tell me if there is a futures market there on the Hang Seng.....as I don't know if there is......I hope you keep up the good work you are doing and even though you are giving up alot of your time in maintaining your web site ....I think it will pay off in the end.....
HW: YES, there is a future markets based in Hong Kong. Also you can play the AMEX HKO - Hong Kong options, but its is relatively illiquid with wide spreads. Still the R/R of the Hang Seng at 15,100 and a time frame of 4-6 weeks makes this potentially attractive.
You wrote earlier about trouble for Disney in July. Sure enough, the Southern Baptists are looking to boycott them. However, the stock has not moved too far yet. Do you still feel that they are in for more trouble? The effects to occur soon? Bad movie revenues?
HW: Most people assume their movie revenues will be blockbuster, so any surprise likely to be on the downside. A bad family image is VERY bad for Disney'! Friday, Disney broke 80 on its way to support at 73 and below??? That is soon enough for me! This remains my FAVORITE summer short.
Cris Cadbury says a 20% dip is upon us. Do you agree with him? What do the stars say about it? I feel this may be a pre-summer rally dip.
HW: I agree, but going first for 5%+. One caveat is the new DIJA options and index funds which may be super sucessful and blip the market up in September. As soon as we have the exact launching dates of the funds and indices, we will make further comment.
1. SELL THE WORLD?
2. INTEL, DISNEY, NCR
3. HONG KONG
4. NEW RADIO SCHEDULES
5. LETTERS
1. Tuesday June 24, we again draw a line in the sand, but not only for US markets this time but also for many of the world markets. While July 2nd is NOT a good personal day for me (hence we are covering bond shorts June 27), we do have a number of key stocks down in July suggesting a correction AT LEAST for that month. Perhaps due to selling on good news - that Alan is not raising rates??? Of course watchful money management is required as we are aware that Chris's new projections are for Dow 7950 to 8600 by the end of the next month.
2. NCR: again tested nears it 52 week low, and remains one of our profitable shorts. Still restop slightly above 30 and trail down would be my advice.
DIS: boycott news would satisfy our astrological criteria and DISNEY remains our safest short for July (August puts). Stop at 88, target 72 or below. However it is possible that while our call for Disney problems in December, March and June was accurate, the stock could act as it did in March and not December.
INTC: seems to fit its frequent pattern: Down into July and then up September/October/November. We would short over next two days and stop above 152, P1 140 P2 125.
3. Our June 2 Hong Kong short returned a rapid 5%, but then the Hang Seng index surged 647.87 points, or 4.5%, to close at 15154.36, extending Thursday's 303-point jump. It was the blue-chip index's biggest one-day points gain in history and its first close above 15000. Tuesday June 24, we are on "World Short Day" which naturally includes Hong Kong. See HONG KONG on our website for future updates.
4. We are changing our Trading by the Stars real audio radio broadcasts to Tuesday and Friday. This will allow for update changes to WSNW reports. Also note we posted our FINANCIALLY SPEAKING radio show on our website. I believe Mitch hosts one of the best financial radio shows around and not just because I occasionally co-host it. :)
5. Could the technical condition of the market determine how to look at what meaning the stars foretell? Example, let us say the RSI is below 30 and oversold and a stock is trading near a support line, it may be a confirmation that the odds favor support holding. Conversely, planetary signs indicate volatility and strong moves and the technical are close to support rather than resistance could you then assume that a rally may begin or vice a versa?
HW: Definitely one factor. Also, UP INDICATORS BY SUPPORT DO NOT HAVE TO BE LARGE, CONVERSELY FOR DOWN INDICATORS AT RESISTANCE.
China has just announced, after market closed Friday with the biggest one day gain of 600+ points ever, that it will not be easy to transfer public assets cheaply to "private" companies in HK controlled by communist cadres. The market may well correct sharply soon, after having gone up 1,000 points in just two days. Most seasoned observers are saying that HK now feels like 1987.
HW: We agree. Our mechanical technical system doubled up on Friday close, while our discretionary astrological system will Tuesday within +/- 1 day. Tuesday June 24, we are on "World Short Day" which naturally includes Hong Kong.
HOWEVER, WHILE WE ARE QUITE BEARISH THROUGH AUGUST due to the prominent Mars in the July 1 horoscope, looking forward a couple of years, astrologically the new HSI Red Chip Index is VERY BULLISH!!!!!
Please send your comments, questions and suggestions to Letters,
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1. 7799: CONGRATULATIONS CHRIS
2. WSNW ALERT #4
3. MTA MEETING
4. NEVER WRONG
5. WSNW BY FAX
6. LETTERS
1. For months, Chris has been maintaining the DOW will go to 7,800 to 8.600 BEFORE the end of July - good call Chris. He just revised UPWARD his forecasts for the next two weeks. See CADBURY NUMBERS on our website.
2. Our call for a possible top on Thursday close was premature, however the R/R was positive. Short term traders obviously exited Friday morning AT LITTLE OR NO LOSS, while Intermediate Term traders may have held over the weekend or been stopped out depending on R/R. Note two items: 1) Upcoming Options Expiration week, so some corrective movement expected and 2) Watch if Bonds break out above our P3 level of 112. We may exit/re-enter/enter DAILY next week as we require ALL our marbles for the BIG day: June 24th and our July forecast. Fortunately many of our major shorts Intel and NCR still profitable or holding well enough e.g. Disney. Yet 7800-8000 looks increasingly possible. Doing a big study on Intel shortly, so check your charts!!!!
3) At the last MTA meeting, Michael Krauss chief technical strategist of Chase Securities echoed his [and my] view of Winning Trading: It is primarily about Risk/Reward and Probability. He also quoted an early mentor who said: " If it doesn't get any better than this, [e.g. Inflation, Growth, Profits] then exit your positions" - "It doesn't get any better than this!" Sound familiar?
4. Never Wrong? I thought there were 4 types, but at our monthly salon, I found out there are 5 who are never wrong:
1. LIARS
2. BEGINNERS
3. CON ARTISTS
4. THOSE WITH SHORT TERM MEMORY LOSS and now I add
5. THOSE WHO ONLY BACKTEST AND PREDICT WHAT HAS HAPPENED.
5. You may now receive Wall Street, Next Week editions either by Email or Fax.
6. I am interested in trying out this service [Cadbury] for a quarter. How do I subscribe? Also, why is your forecast contrary to that of Henry Weingarten's? Readers of Afund are getting conflicting signals and don't know who to believe.
HW: Excellent Question. First of all, the US market is but one of many markets we track. Cadbury tracks money flows, sentiment, market betting and other market specific factors. However they can be over-ridden by astrological factors as on March 11 when Chris was bullish. Markets are influenced by many factors including fundamentals, price trends, flow of funds, momentum, sentiment etc. AND of course Astrology.
Clearly the US market has been very bullish recently. Yet as a Cosmic Value player, I prefer the R/R of the short side. My personal comfort level in 1997 mostly TRADES the long side e.g. Japan, T, Fro, and often gets a Years' INDEX profit in weeks or months. FINALLY, WHO TO BELIEVE? BELIEVE THE MARKET!
You can subscribe to Cadbury by emailing, faxing or writing us. We supply FULL timely editions in both fax and email format $99 quarterly or $300 annually.
>> I have never owned any stocks until this year. I own AOL, GE, INTEL, AMEX & IHI...What is your opinion on buying Novell and/or Apple now???
HW: Novell we like especially for 98. Apple since shorting to the 15 area, we lost interest. AOL we are Neutral/Bearish above 57; analyst targets of 70 too optimistic from my fundamental view. Astrology - currently neutral vs the last three months when VERY bullish. I recommend selling AOL or Stop Loss AT 54-56 or Selling Call Options. IHI, we just put a Trading buy on it, so relax with that. GE, AMEX a general market bet; both good companies, so if you are bullish (which I am not), both good holds. INTEL we are reporting on shortly.
I noticed the prior market top of March 11 occurred one day after Mars conjoined the mean position of the Moon's Node on March 10, Mars RX. The Value Line Composite Index in fact made it intraday high on that day. Mars will conjoin the Moon's Nodes, while it is direct on June 6 - see also June 12/13, perhaps a market crash?
HW: These were high-volatility days, although not topping days or crash days so say I AFTER the fact. :).
Do you think the next move in interest rates will be lower and bonds higher (continuation of recent rally) or a short and abrupt sell-off that surprises the market sending bonds lower and stock in a tailspin?
HW: Friday's report does not seem to support the former. Yet, WSNW ALERT #4, could have been "SELL bonds ~ 112". Our midyear report is very bullish on Bonds. Hopefully I didn't miss the beginning move, as the Astrologers Fund Inc motto is: 'BE THERE FIRST".WALL STREET NEXT WEEK 6/8
1. JURY STOPS
2. GOLD
3 CADBURY
4. LETTERS
1.WHILE on jury duty Friday, the market took out our 7350 trading stop. This gives 7600 a real possibility as a top number. So, we do not say uncle, we regroup and fight once again! However, KEY short positions like DISNEY remain untouched. Our technical system went short on Friday close or opening Monday (tight stops). Next technical stops, 7,500 (short term) or 7.600 long term. Timing dates: June 12 and June 24,25 for possible LONG term tops. Note: Jupiter goes SR 8:24pm ET. Monday night.
2. We will shortly be shifting from a buy/hold to a hold/sell on Japan. This money we believe would best go into GOLD and/or Australia. This theme will be discussed periodically on our website posting GOLD.
3. We realize of course, that both money flows and the option premium ratios (market betting) are very important indicators of short and intermediate term market direction. This is why we present the Cadbury numbers on our website and read full newsletter (which we will have up on our site soon). For months, Chris has been maintaining the DOW will go to 7,800 to 8.600 before the end of July. We have conceded part of this, up to 7,600, but disagree strongly about JULY. June is a 7000-7,600 (max) trading range for us.
4. In this 16 year bull market there are players who are NEVER WRONG:
1) Those who DON'T try to time the market (buy and hold);
2) Those who DON'T buy value (value stagnates; momentum reigns)
3) Those who DON'T diversify (100% index stocks is the key)
4) Those who DON'T try to manage their money. (The S&P out performs everything)
HW: GOOD answers; next time I give mine.
RE: HANG SENG: You should be aware, however, of two things. I don't know whether it makes any difference to your prediction.
1. More than half the stocks in the Hang Seng Index have actually gone down year to date and the index is helped mostly by the performance of the Hong Kong bank which has nearly doubled this year. HW; YES SAME AS WITH OUR INDICES, MANY STOCKS DOWN EXCEPT THE LEADERS.
2. The market players who are pushing up the "red chips," companies linked to mainland China companies are convinced that the Chinese government will not let the market collapse just before the beginning of Chinese rule in July 1st because of "face".
Thus Chinese connected companies are now trading at 50 + multiples while the market as a whole is trading at around 15. So does your prediction for China also says that they will let the market decline?
HW: YES BUT HOW WILL THEY RESPOND TO STRIFE? I THINK THERE MAY BE DEMONSTRATIONS, JUDGING FROM THE JULY 1 CHART. 15,000 AREA DECENT PLACE TO PUT A SHORT. WILL KNOW IF GOOD WITHIN 60 DAYS! Besides, astrologically June 2 atleast a TRADING top if NOT MORE!
So, it seems that based on the info from you I've seen, you are not seeing there will be a crash this year or next, not until around 2000. Is this correct?
HW: Well Astrologically it should happen between February 1997 and May 2000, IF AT ALL. Obviously March 11 was not the top. We have severals dates each year (2 this month) that are possible, which we will give here. But unlike numerous foreign markets, where we have been successful in calling tops or crashes the FIRST TIME, here just picking POSSIBLE times. Todate we don't seem in sync as well as we could/should from an investment, vs the trading perspective.
Please send your questions, comments or suggestions to Letters,
Monday & Thursday, listen to our ABS radio program TRADING BY THE STARS
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