Financial Astrology: Pre-October? How High is Up?

1.SEPTEMBER MARKETS                                              

2. UP STARS/DOWN STARS

3. GOLDEN OPPORTUNITIES                        

4. QUOTES

5. ON THE WEB

6. LETTERS

 

1.WHITHER STOCK MARKETS Pre-October? How High is Up? How Low is Down?

SPX 3030, 3057 or Higher?  SPX 2880, 2850 or Lower?

Unless you closely track the horoscopes of President Trump, Chairman Xi AND Fed Chairman Powell, the RIGHT answer is probably unknown.

 

OUR VIEWS

We continue to modestly & selectively nibble long undervalued stocks as investors into a projected Fall/October rally to retest YTD market highs.

Unless/until there is REAL US/China Trade deal progress, markets will continue be TRADING MARKETS.

 

It is quite possible the recent bottom IS in, but also possible it is not!  Before October 1, the odds STRONGLY favor Xi is likely to stay nice with Trump.

FOMC Week will be Rock & Roll regardless of what the Fed does or does not do or say!

Early this coming week we are first expecting a potential test of SPX 3000 and should the FED disappoint, we will be happy to BUY.

conversely, it the FED makes markets smile, we may sell the rally end of the week.

 

Proper Valuations:

US$ ~98

OIL 52-58

DJIA 26500-27500

SP 2925-3025

NASDAQ 8000-8250

Silver 16-18

CNY < 7.06

BP > 125

 

IMHO “Improper” Valuations

US 10 Year Bond  < 1.88

TIPS  > 114

COPPER < 3.20 

BITCOIN > 8800

GOLD > 1430

 

FIRST EPISODE OF YOU BETCHA YOUR LIFE (SAVINGS):

Sell SP 2954,  Sell 2945 KACHING: Both Covered 2840!

SECOND EPISODE OF YOU BETCHA YOUR LIFE (SAVINGS):

Sell SP 2888, Sell 2880 KACHING: 2812 & 2750 Buy Gold 1286, 1280 KACHING 1400, 1410

 

THIRD EPISODE OF YOU BETCHA YOUR LIFE (SAVINGS)

Sell SP 2954, Sell 2964, & 3000; KACHING Closed 2940 & 2925 & 2925 Buy Copper 270, 266 & 260

 

H2 2019 POSITIONAL TRADING: 

Copper 274, 266 & [292 Copper open from H1 2019] 

Sell SP 3057+; Buy SP 2980-

 

KEY DATES:       SEPTEMBER 16-20, 23

DJIA:                   27397 RESISTANCE 

SPX:                    2980 PIVOT R1 3018 R2 3030  R3 3057 R4 3100 R5 3200 R6 3300

NASDAQ:            8050 PIVOT 

GOLD:                 1505 PIVOT 1430 SUPPORT 1566 RESISTANCE 

SILVER:              17.50 PIVOT S1 17 S2 16.50  S3 16  R1 18  R2 18.50  R3 19.50

OIL:                     55 PIVOT 52 SUPPORT  58 RESISTANCE

COPPER:            STEADY ACCUMULATE: 2020 à 3.50+

US 10 year          WATCH

BITCOIN:            10000 PIVOT

 

2018 CLOSE:          DJIA 23327 SPX  2506 & NASDAQ 6635

2017 CLOSE:          DJIA 24719 SPX  2673 & NASDAQ 6903

2016 CLOSE:          DJIA 19762 SPX  2238 & NASDAQ 5383

AFUND Fair Value: GOLD $1405

THINK TRADITIONAL SWISS AND PRESERVE CAPITAL: HEDGE AND PROTECT AGAINST DOWNSIDE RISK.

 

2. Stock selection remains important. We recommend buying stocks sporting strong cash flows, sound balance sheets and growing dividends.

Actively managed portfolios will continue to deservedly outperform index funds in current bifurcated markets.

 

3. Why Russian and Chinese central banks will keep buying gold

HW: Only gold is as good as gold!

 

To repeat, Silver was overvalued and ahead of itself. While Silver $20 & $25 is still possible in the future, we do not see it short term. We want to see lower prices, so we can again be on the long side.

Ditto with Gold.

Copper remains the most undervalued commodity we track. It is finally trading above its 12/31/2018 close of 2.63 it is a long term STEAL, especially If/when XI/Trump make nice.

Should CNY move decidedly under 7, we can expect a quick retest of 2.80 & more!

 

Gold bugs are happy now that more generalist investors are beginning to join the party:  Gold bull’s forecasts for $1500 were right [not by me] & calls $1600+ gold are frequent.

We believe gold valuations will largely sport at or above Fair Value into the Year of the Earth Rat (2020).

Just as it was undervalued for a long time, it CAN and is likely to be overvalued for a LONG time.  While fundamentally gold is currently overvalued, in much of the Fall, the astro is positive for gold.

We advise precious metal investors to pay attention to stock selection and only selectively add SUMMER 2019.

Gold remains cheap geopolitical crisis insurance.

For investors who cannot or will not buy the $US currency as well as investors who wish to safely and cheaply hedge their US$ exposure, ONLY GOLD IS AS GOOD AS GOLD!

 

Gold FV $1405 = Commodity FV: 1358 + Currency FV: 1388 + Inflation Metal FV: 1366 + Crisis FV: 1508.

INVESTORS: We plan to stay LONG in H2 2019 (recommending a precious metal sector buy/hold rating and occasional hedging, selling or profit taking).

However as traders we may periodically short gold $1488+. For silver our best selling numbers remain $18-20.

 

4. “The U.S. dollar is in demand because the market increasingly believes that the Federal Reserve won’t cut interest rates as much as previously thought. That is reflected in USD-CAD more than anywhere else.”

Adam Button, chief currency analyst, ForexLive

HW: That is my hope.

 

“This is different than the past few moves back to highs. You have a bigger base. When you have one group that’s leading and everything else is left behind it’s easy to lose that one group, and you hit an air pocket. When you have a lot of groups and they’re taking turns, it’s harder to break the back of the bull.”

Scott Redler, technical analyst and partner, T3Live.com

HW: The market clearly wants to go higher. 

 

"There has been a shift from growth stocks to more value stocks."

 Alan Adelman, senior fund manager, Frost Investment Advisors

HW: As a “cosmic value” investor, that is music to my ears.         

 

5. The Great Rotation: Can The Value Rally Last?

Five pitfalls to avoid while hunting for hidden gems in small-cap land

 

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