March 8 WALL STREET, NEXT WEEK:
Financial Astrology for the Successful Investor and Trader
1. DOW 10,000
2. EURO
3. QUOTE
4. LETTERS
DOW 10,000? "It's a fairy tale come true" said Patricia de Blank Link, CIO at Advisors Capital Management. While it is increasingly possible, it is as foresighted as selling one's home to buy tulips. Remember, "The Fat lady has yet to sing" and "It ain't over till its over."
Despite our forecast for a March 99 projected peak (primary or secondary) around the 25th, we anticipated the Friday news report numbers negatively. However, our interpretation differed from the market's. While the Mercury/Venus/Jupiter in Aries gave it a positive spin, the Bond market came around more to our view and retraced almost all the morning's gains. The stock market did not. Bond traders, unlike stock traders, preferred "selling on strength" to "buying on dips." Monday, US Bonds should be the clue either for further stock market gains, or temporary profit taking. Either way, all month we are raising cash levels and urging client-brokers to call their clients to begin to reduce all non long term holds.
Is Yahoo about to join Amazon in selling Drugs?
Fueling its 5 percent rise was an upgrade from Hambrecht & Quist
to buy from hold as "Yahoo strengthens its position in the growing Internet
landscape." Separately, CS First Boston reiterated a buy rating on Yahoo!
But wait, its gets better: According to Reuters: "Investors rushed
back into the market for Internet stocks on Friday to take advantage of
bargain prices." We rushed in to short it at 159. While we
may have to run away, if it look likely it will go to 175, we will take
this one home to moma soon.
According to Securities and Exchange Commission filings:
***This week Paul Allen has filed to sell one million shares of Microsoft.
*** Dell Computer Corp. founder Michael Dell and senior VP Carl Everett
are looking to sell a total of 4.38 million shares.
YOU WANT TO OWN THESE STOCKS AT THESE PRICES?
***U.S. Bankruptcy Filings Rose 2.7 Pct to Record 1.44 Mln in 1998.
STOCKS TO WATCH
The IBM/Dell news is another reason why IBM will be our favorite 2000
computer stock, and Dell will not be.
We like BAANF, although we bought a month too early. Just as
the market exaggerates on the upside, so it does on the downside.
In retrospect, we could have waited for a 85-90% retracement, instead of
80%. We will be more patient with CompUSA (CPU) which is approaching
our buy target of 4-5 and Parker Drilling (PKD) both probable 12-18 month
turn around stories.
March 10 through April 2, Mercury will be Retrograde.
Key Dates: March 9
DJIA:
9180-9643 or 9400-10,000?
EURO: Accumulate
2. Euro/dollar plunged to a new record low, breaking the important $1.09 level, as players continued selling the two-month-old single currency. Alison Cottrell, an economist at PaineWebber International, said the divergence of falling business and rising consumer confidence in Germany, which accounts for this split is not sustainable,''Either falling business confidence will begin to weigh on employment prospects and pull down consumer confidence or reviving consumer confidence will help corporate confidence perk up.''
Cottrell and other economists said they were betting spending by the euro region's 300 million consumers will moderate the effects of slowing exports and manufacturing production.That, will also depend on the European Central Bank maintaining a weak euro, which has fallen as much as 4 percent against the dollar since its start on Jan. 1.
Analysts surveyed by Reuters forecast the euro will over the next 12 months find its footing and rise to $1.16 from Wednesday's rate near $1.09. But that target, well below its launch rate of $1.1740, falls short of initial hopes. (But not the Astrologers Fund forecast.)
"The euro has the makings long-term of being a strong currency because (core Europe) has a current account surplus. It does not have the imbalances that the U.S. economy has,'' said Alan Ruskin, research director at 4Cast Inc. ``But I'm not sure that that's not a story that could be out there in the year 2000 rather than the year 1999.''
For our latest forecast on the Euro, attend our seminar in Copenhagen this March 24. Selvfølgelig, De taler dansk ikke?
3. "OLDER SAVERS INVESTED ONLY IN INTERNET STOCKS COULD BE IN REAL TROUBLE" - Alan Greenspan
4. Reader: I plan to buy puts on Monday. Tuesday at the very latest.
This bullish cycle extends into March 8/9th. The cycle bottoms on
March 16/17th. So far the cycles I follow have not led me astray,
they have been right-on!
A: We agree.
Q: The million dollar question is: would you still purchase more [IHI]
at these levels or do you think it may come back a little?
HW: Any buy under $1 US is a steal, given current company progress.
Our P1 target is $10. I expect $1 to become the floor within two
to eight weeks. As long as you are not over weighted, I would buy
more (and have).
We have raised our rating of IHI from a speculative grade to appropriate
for very aggressive high growth, High Technology portfolios. See our latest
IHI posting at IHI PART
VI
Reader: I hope you don't mind my saying (since you have heard
it many times before) you are so good with your forecasting, it's almost
unbelievable. Since I am sure I am not the only one with this dilemma,
I was wondering if you might consider starting a "beginners service", or
the "green" fund if you will? Maybe email specific trade recommendations
either before the market opens or after it closes?
A: I am leery of doing this. If you require this type of hand
holding you can easily lose money in today's markets. I would recommend
trading only our Wall Street Alerts as they offer our highest probability
of success and often double an appropriately chosen option.
Alternately, intermediate term investing 1/6 of ones trading capital
each month our Stock of the Month picks historically has provided far greater
than 25% annual return. While this would not be a get- rich quick
scheme, it is better than losing money trading and could well substantially
out perform buy and hold index strategies.
Q: What happened to your "blood in the streets" prediction of February
16?
A: It was a risk/reward forecast, the same as for WSNW 36F. Historically,
most WSNW alerts provide a substantial trading edge: 100-200 points, as
did that one, although not the very latest one. While that move down
didn't hold, it was playable more than once and you could have easily doubled
or tripled your money since we recommended shorting from close to 9400.
Remember, WSNW Alerts are meant for traders, NOT investors.
Date High Low
Close
02/16/99 9458.46
9187.10 9297.03
02/17/99 9409.53
9124.03 9195.47
02/18/99 9368.48
9145.09 9298.63
02/19/99 9430.59
9218.13 9339.95
But don't despair, "blood in the streets" will be coming
this year for investors too.
Please send your comments, questions and
suggestions to Letters.
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