1. MAY MARKETS
2. JAPAN
3. GOOD COMPANIES, GOOD HOROSCOPES
4. PROPHETTIME
5. QUOTE
6. LETTERS
It may be this week, most of the $30 Billion of new 1999 IRA/Pension money will run out. However, it could prop the market up until a little past May 30 as Neptune is going Retrograde Thursday.
The most interesting event next week is the Goldman Sachs (GS) IPO Tuesday. We do not foresee this will be a big winner intermediate and perhaps short term as well. This could even be one of the defining moments of the END of the current bull market. Of course, do not be surprised if it looks good for a few hours or even days.
The New York Times plans to ban advertisements for cigarettes, cigars and other tobacco products in its pages effective Saturday. This cannot be good for Philip Morris - can it?
Key Dates: May 3, 6,
JAPAN
SELL
2. Japan's ``Golden Week,'' a string of national holidays began Thursday and runs through May 5. We celebrated by positionally shorting the Nikkei 225. Watch our benchmark Japanese stock- SONY (SNE). We recommended selling above 100 ahead of the news that Sony's profits are falling and its own forecasts for a dismal year. You could short this stock as a proxy for Japan until 75-80. We also expect a declining Japanese currency, but this is a positive for major exporters like Sony. Japanese banks are to be avoided at all costs, or to be bought only under government duress.
3. Our May Stock of the Month club pick might have been the Argentine Oil company YPF, but it already just made its move a few days ago. :( Compaq is a possible pick, but at 22 I find it still much too rich. IHITF has a good May chart, but that seems almost like cheating. Reits are another possibility. Our two current favorites: SSS: Sovran Self Storage (9% Yield) and SLG: S L Green (6.9% Yield) including yield might give a 25% return, but in 12, not 6 months, so I would prefer to buy after a further 10% price drop. This could happen if bonds continue falling. So at this time - confusion! Neptune is changing direction Thursday night, what do you expect? What do I advise? Be safe: Buy Good Companies at Good Prices, or don't invest at all.
4. From the PropheTime
Bulletin
‘Timing Low’ period = May 03rd|05th
‘Timing High’ period = May 05th|10th
April 30th to May 05th is anticipated to provide for lower price
levels [May 03rd|05th being a 'timing Low period'] and a minor basing action
setting up for the rally into the May 05th|07th 'timing High period.'
In this respect, May 05th has a good chance to become an Up
Close day with May 06th having a much higher 'timing probability' for being
an Up Close day.
HW: Re: ‘Timing High’ period = May 05th|07th, we agree
with this possibility - after all who besides us is willing to go short
just in front of Mother's day? Most good sons and daughters will wait for
Monday the 10th. But as my mother exited the market the week before
the October 87 crash and with the exception of IHI, has very few stock
holdings these days, she has given me permission!
5. ``We will see more mergers in Europe,'' said Uwe Zeidler,
who helps manage 30 billion euros at Westdeutsche Kapitalanlagegesellschaft
mbH in Duesseldorf. ``They will be mostly in telecoms, pharmaceuticals
and banks.''
HW: We agree.
6. READER: With the Swiss doing their bit re the sale of
Gold- how do you see this affecting our Homestake Mining (HM) in the next
3 months.
HW: As we bought Gold futures on Friday (again), and as
a rising tide lifts all boats, we are still bullish on HM and NEM and ABX
for this summer: first stop XAU 79.
READER: Just received confirmation of my subscription to AFund.
I am still not sure whether I will receive weekly news letters by the net
or should I go on line to check your web site.
HW: You will receive WSNW by email each weekend. Going to the
net on our premium channel subscriber area allows you access to other postings
not available to the public.
READER: Re CPQ: The consensus is that it is a Compaq issue and
not a reflection of the over-all PC market place. To base a CRASH
on less than 1-2% time frame within a 15 month stock pricing is quite a
stretch and holds no validity to the Compaq Stock price facts for these
last 15 months.
HW: Excuse me? If you buy and HOLD stock and it is down
more than 50% and stays down, that is a crash. Let's continue this conversation
in August.
READER: You noted that more and more stocks are down 50-95% from
their 1998 highs. I find it amazing that so many "experts" talk about the
correction, crash, etc., coming because of such high valuations when that
is only true for a thin layer of stocks. Besides those few that are
keeping the indexes up there has been a bear market for sometime. It will
be interesting to see how these already pulverized stocks do after the
stronger ones get nailed. Will the ones who have been down for a while
be the first to recover? In other words does value lead the market back
or does growth? I guess, a case by case basis.
HW: Since April 98, many stocks have been down as you
note. I would check the horoscope of each individual company stock
to answer your question. In general, with the May 2000 Jupiter/Saturn conjunction
approaching, we believe Value will outperform Growth as it historically
has periodically.
READER: I would like to short the market via a mutual fund I
know of two Rydex and the Prudent Bear Fund. I am thinking of getting
in to one the first part of July?
HW: I would suggest sooner!
READER: I would like to day trade IHITF. I notice that
each day it reaches a low of .75 to .80 per share. My goal here is
to buy here and to sell when it reaches .90 or above, making
very small gains, and converting the gains into additional stocks. I can
only do between 600-700 shares to start, and want to begin Tuesday 4/27/99
making my first Day trade with a .76 to .78 Limit. Once the buy is done
I will watch for the high and sell at that time. I will have to wait for
the stock to settle 3 days before I can make my next buy, and begin
the process again. Do you feel that the market will sustain my thinking
for the next month? Any comments would be appreciated, as well as pointing
out the error of my thinking.
HW: The OTCBB is not an auction market like the NYSE. You can
NOT buy on the low and sell on the high. In addition, there is the
cost of a round trip commission. I do not believe what you propose
is possible unless you are an exchange trader. However, if I am wrong,
do let me know and I will join you! :)
READER: I would like your opinion on buying HM through the summer.
Do you feel the price will stay around 9, or can more be expected.
Your opinion appreciated.
HW: Why you wish to buy or hold HM - as a short or long
term investment or as an intermediate term trade and/or as a portfolio
hedge? In general, I am holding HM for the summer in a number of
accounts. As to whether it will hold $9, is less important to me
that I consider it value under $11.
READER: OK, maybe I'm always late to the party but I want to throw my 3 cents into the speculation on when the Bull will be brought to its knees. I took another look at the NYSE chart and see that it is in what for any of us would be a mid-life crisis transit (except the NYSE is really old now!) with transiting Uranus opposition natal Uranus. The last of the three passes will be in January 2000. Typically, this transit brings with it a sense of urgency and that one is faced with a "last chance" to get in on something one may have missed. Given, too, that we are looking at Uranus placements in Leo and Aquarius (and, depending on the chart you use, possibly in 1st/7th House opposition), I think this explains a lot of the strength in the tech and Internet sectors... coupled with a market Millennial Fever.
From a cycles standpoint, June/July/maybe August will bring the end of the first 50 week cycle of the current four year cycle. Even with the Saturn/Uranus Square, we shouldn't see more than say a 1,200 - 1,700 point drop in the DJIA. I think all of this will converge for the 22.5 months cycle in May 2000 when the Uranian opposition will have passed, Saturn/Uranus will be closing, and Jupiter/Saturn will be conjunct. This could bring a 2500 to 3500 point drop, with recovery afterward retesting the 10,000 level until 2002 - 2004 when what should be a true bear scare will grip the market.
In short, I think that Uranus in Aquarius is confounding a lot
of forecasts. True, techs are very much over-valued and it can't
last forever, but I think it will last for longer than many think.
So, this and $2.25 will get you a cup of cappuccino...
HW: Soon $2.50 - remember upcoming Jupiter/Neptune aspects!
READER: 1. Do you see the Big fall on the 1st July or the 11th
August?
2.Do you think that instead of a temporary somewhat severe correction
the market will keep drifting down for the rest of the year or behave like
1998, 1997 etc. whereby the corrections are followed by another phase of
the Bull market- I sense you are predicting a bear market- for how long?-
most bear markets last on average 12-14 months - is that how long you feel
this one will last if indeed that is what we are in for.
HW: I will be short AHEAD of both days. While many
market Cycles are compressed these days, until we get to 7001.67, I believe
it is premature to answer the second part of your question.
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