1. AUGUST MARKETS
2. UP STARS/DOWN STARS
3. GOLDEN OPPORTUNITIES
4. QUOTES
5. ON THE WEB
6. LETTERS
 
1. POTENTIAL NON-DISASTER/CHINA TRIGGERS FOR THE UPCOMING MARKET CORRECTION

•    The Consensus that the Worst is Over is realized to be Wishful Thinking & Government/Wall Street Propaganda
•    The reality that the US economy is not improving dawns
•    Lack of fresh reasons to buy
•    Markets are increasingly realized to be too expensive 
•    Earnings disappointments
•    Lack of Market Momentum
•    Ben’s Boys go on vacation (and stop propping up the market)
•    Early Warnings on Q3 Earnings
•    Future Bond Auction Disappointments/Failures
•    Consumer Confidence wanes
•    Ben does not buy Commercial Mortgages
•    Banks are forced to report real aka Non-Enron Style, Accounting
•    Housing does not improve and has not yet bottomed
•    Bernanke's "Great Depression" policy of ZERO interest rates is not sustainable
•    The size of the bailout and its cost result in taxpayers likely to lose billions of dollars from financial rescues dawn, e.g.  Regulator  doubts Fannie, Freddie can repay rescue funds
•    Other Double Dips such as continuing job losses
•    Etc. 

YOU CANT GO HOME AGAIN
Champagne Drinkers Are Turning Thrifty
Finance will never return to the pre-credit crisis model -  New realities include that not only are the days of cheap energy and food over, but the US consumer will no longer to be able to shop until they drop on phantom credit.

Fair Value for the S&P 500?
"equities are either pretty darn cheap, or bum-clenchingly expensive based on 2010 earnings"
HW: We think the latter.
BOTTOM LINE: We have a VERY bad feeling about this Market and advise again reviewing your stock portfolio for possible reduction/selling.

AUGUST ASTRODATES
8/04 Lunar Eclipse  8.55 pm ET
8/20 New Moon 6.02 am ET
8/22 Sun Enters Virgo 7.39 pm ET

TRADERS: In the absence of market moving news, we prefer the short side into September and Dow above 8500 but given little daily negative astro alternatively Buy DJIA/Sell Nasdaq.

INVESTORS: My long term view is well known. Focus on protecting against downside risk and only buy and hold stocks with sustainable earnings at Deeply Discounted Value pricing.
Invest only in stocks at bargain basement price that you are willing to hold until 2011.
Soberly prepare for the reality of an L (U?) shaped US economy for the next two to eight years.

FAIR VALUE RANGE:   DOW 8200 NAS 1688 SPX 8800
LONG/SHORT PORTFOLIO:  L1/S1
 
KEY DATES:    AUGUST 6
DJIA:                9200 PIVOT 8200 SUPPORT 8800 RESISTANCE
SPX:                940 SUPPORT 1000 RESISTANCE
NASDAQ:        1880 SUPPORT 2020  RESISTANCE
XAU:                138 PIVOT 160 RESISTANCE
OCT GOLD:    930 PIVOT S1 960 S2 940 S3 920 R1 980  R2 1005  R3 1035
SEPT SILVER: 13.60 PIVOT 12.67 SUPPORT
XOI:                 920 PIVOT880 SUPPORT 1010 RESISTANCE
DEC OIL:          66 PIVOT 62 SUPPORT 77 RESISTANCE 

Market Marker Sentiment until 2010 is Less Volatility with Market Cross Currents.
Stocks Meander slightly ahead and favor defensive plays.
The US$ doesn't collapse & Commodities may not be needed as a safe haven panacea. 
7/21 PRE-ECLIPSE: DJIA   8915. SPX   954 & NASDAQ 1916
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:                       7 ~ FV 2 UV; 6 offer 4%+ Dividends 4 offer 5%+ Dividends.
THINK TRADITIONAL SWISS AND PRESERVE CAPITAL: FOCUS ON PROTECTING AGAINST DOWNSIDE RISK.

2. How to Profit from Japan's August General Election
"Japan has well known "issues."  The Japanese economy remains mired in its worst recession since World War II, but many economists believe that the worst may be behind it. What is most interesting and new is that the lower house of parliament was dissolved under the influence of the July Total Solar Eclipse. This suggests the short term end of LDP (Liberal Democratic Party)  rule and a new game in Japan in the Fall 2009/Winter 2010.  From a Global perspective we remain Neutral on Japan Equities as we see no reason to be either bearish or bullish at this time."
WSNW Subscribers can read more at our newly revised premium post: S: JAPAN (8/1/2009).
 
3. SIVR is the new Silver ETF that debuted at $13.94 at 9.30 am on the NYSE 7/24/2009.  We agree, that while more volatile, Silver Safer Than Gold, Natural Gas especially this Fall.
Will I be able to realize my hope to buy Silver 10% cheaper circa $12.50 before its Fall rally?  Time will tell.

4. “This wonderful rally we’ve been having, 40 percent off the March lows, is going to correct itself.  The banking system is still fragile.”
Vince Farrell Jr., chief investment officer, Soleil Securities Group
HW: Just because the Commercial loans debacle will increase and last AT LEAST 6 to 18 months?
 
“My concern is that the valuations aren’t justified. The market has come a long way in the last month and while earnings have generally exceeded expectations, the expectations were probably set too low.”
Charles Knott, chief investment officer, Knott Capital Management
HW: Ain't it the truth.
 
“We’re still in the stage that the rising tide of a recovering economy is going to lift all boats. This phase of the bad news getting less bad is continuing to be sustained. There’s a lot of hope and optimism that’s being built in.”
Marc Harris, co-head of global research, RBC Capital Markets
HW: I don't agree that "this phase of the bad news is getting less bad" will continue.
 
5. Insiders have hiked their selling
 
Surging Earnings Estimates Signal 26% Advance for Shareholders of S&P 500 
 
Little-known inflation hedge gaining new popularity
Until recently, relatively few investors even knew about a remarkably safe investment that brings with it the benefit of an inflation hedge, the market-indexed CD.
 
6. READER: Re: Special WSNW Alert 10.45 am Thursday – Could you elaborate a bit?
HW: Simply that markets are over valued and VERY scary.  The current risk/reward makes this a favorable place/time to go short.

READER:  Do I short the market now?
HW: I can’t advise you as we are not your money manager and you do not have a trading subscription.
However, I can say we are currently short both tactically and strategically, but use prudent money management until the investing tide, aka momentum, turns in our favour.
 
READER: Sadly, I found a person who thinks the way I have been thinking for a few years. The Dark Years Are Here
The exact unfolding of events might be off in timing, but given the way things are, and everybody bent on implementation of Keynes type economics, the results are inevitable.
HW: Here's one way to play such fears: Investing rules for The End of Civilization

READER: I think that this mania bubble will end really badly and perhaps soon? The eclipse should take effect pretty soon?
Balancing long term core positions with puts and ETF's that are shorting markets, including China, may reduce profit in the short term, but it lets one sleep better, and able to fight another day when the dust settles after the downturn. That will preserve wealth.
Then one unloads the puts and uses that cash plus cash already on the sidelines to buy back stocks at a reduced price. Hope this works!!!
HW:  I don’t disagree regarding this Bull trap.  This eclipse is expected to take up to 90 days. We see things in the works in August and September that are not likely to make fresh investors happy.

READER: It's [Silver] going to 14 Henry.  Don't be left on the sidelines :)
HW: Yes although a little under the water as we are short last 2-3 days.Silver we have down Tuesday and Wednesday but will be happy from Fall on when I can stay LONG silver for at least 9 months!
READER: I say 13.65
HW: My broker has 13.64 as his P1 target.
Note: Silver first went to 14 on Monday, then dropped 25 on Tuesday and achieved our P1 target of 13.65 and fell 48 on Wednesday to close at 13.25. The moral is as traders you can make money in today's markets by being long or short. However, IF YOU WANT TO MAKE MORE MONEY WITH LESS RISK, WE ADVISE USING FINANCIAL ASTROLOGY!

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