Fall is coming

YELLOW/RED ALERT: On both Growth, Valuation & Risk Metrics.

IT IS ALMOST CERTAIN (90%) THAT MARKETS WILL CORRECT BEFORE OCTOBER OPTIONS EXPIRATION!

"Managing the risk is a really important part. It's not about trying to shoot for the highest rate of return you can; it's about protecting what you have."

Leyla Morgillo, CFP, Madison Financial Planning Group.

We continue to maintain defensive protection:

High cash levels cash, low or no margin, writing calls, hedging, very short-term trading, some October puts and buying only special situations into early Fall.

We are not buying today’s pyramid games will continue forever. Some possible landmine triggers beyond Delta/Lambda/Mu Covid fears include:

  • Inflation > 5%.

  • Higher Taxation More Market Stumbles like AMZN..

  • Bitcoin collapses (28K support broken which it will sooner or later) would do it. Cf: bitcoin-why-you-should-be-terrified-of-owning-btc.

  • TNX >1.50-1.75.

  • A change in perspective- comparing not to last month or last year, but a longer-term horizon leaves little upside to analyst projections.

  • Fall FED tapering or warning of future course shift or otherwise losing credibility!

  • The usual assorted geopolitical threats especially US/China aggressive escalation Q4 2021.

I am unwilling to buy at today’s prices, especially SPX > 4000: given the downside risk & its obvious P1 correction target.

Outside of day trading and special situations, we plan to sell/short and wait to buy if/when markets are 12%-20% lower.

PIVOTS         2020 Close 10%- Nov 3
DJI 35000 30606          31963           27480          
SPX 4450       3756             4075             3369            
NAS 14880  12888          13842 11160

 

Most computer programs also monitor their 50 & 200 DAY MOVING AVERAGES FOR SUPPORT TESTS.

Be prepared

Inflation is currently solidly above 5% and I don’t believe it is just “temporary”; if/when the global economy slows, we are likely to see STAGFLATION!

Given still high valuations, there are not sufficient FUNDEMENTALS (Fed accommodation, Vaccines & Stimulus Packages) to justify SP500 earnings.

Our recommendation continues to be maximum portfolio protection.

TSLA, BTC, VIX, GME & TNX are our five market “canaries in the coal mine”:

When three or more canaries sing, be ready to Head for the Hills (&/or your nearest bar) .

TNX: > 1.50-1.75

TSLA: < 695-666

VIX: >22-26

BTC: < 42-30K

GME:* <50-30

*Gamestop & stocks such as AMC [>20] or COIN [>225] are like Bitcoin, their trading has little or no relationship to reality.

Public valuations of large, mid and small cap companies remain near their highest levels in recent history.

Short of a reality check that the emperor has NO clothes, newbies learning that all stocks do NOT go UP ALL the time can also time market tops).

MARKER SHORTS: DJIA 35051, 35208 & 35150 SPX 4411, 4436 & 4468 NASDAQ 14836 & 14835.

TRADERS DO QUICK DAY TRADES OR HAVE VERY DEEP POCKETS.

  • After hard rallies or market drops, it is smart to book some profits.

  • Odds of a market drop before the end of September is EXTREMELY HIGH – We stay prepared!

  • We are ready to add more TNX (10-year US Bond) shorts this next week plus we may not need to protect/dance around positional shorts now.

Trading

Gold: Buy on dips Rinse and repeat & repeat Last buys 1763 [sold 1788 Stop], 1750.

Silver: Accumulate on dips < 24 Buys 25.15, 24.33.

Copper: 4.25 Pivot.

Oil: 69 PIVOT Sell 71-74.

TNX: 1.40-1.75 Targets Short 1.25.

HYDE PARK SOAPBOX: markets-fear-a-different-delta.

Next Wall Street Next Week September 27, 2021.

MARKERS DJIA SPX NASDAQ SILVER GOLD COPPER BONDS  OIL  BITCOIN  CNY
2020 CLOSE 30606 3756 12888 26.52 1901 3.52     .91     48.42   28996     6.52
09/10/2021 34607 4458 15115 23.76 1788  4.42     1.34     69.71 45444     6.44
PIVOTS 34680 4450 15000 24 1792 4.30     1.30     68     46000 6.50
RESISTANCE  SUPPORT 35000  33000 4500 4000 15500  13000 25 23 1845 1755 4.50 4     1.50  1.25     72 60 50000 31000     6.50 6.30


KEY DATES: SEPTEMBER 17, 22-24.

DJIA: 35000 R1.

SPX: 4500 R1.

NASDAQ: 15000 S1 14880 S2.

GOLD: 1844 S1.

SILVER: 24 PIVOT R1 25 R2 26.

OIL: 68 PIVOT 66 S1 70 R1.

COPPER: 4.30 PIVOT S1 4.25 R1 4.40 R2 4.50.

US 10 Year: S1 1.40 S2 1.50.

DXY: 92 PIVOT R1 94.

VIX: 16 PIVOT R1 18 R2 22 R3 26.

BTC: 46 PIVOT S1 44K S2 42K.

2020 CLOSE: DJIA 30606 SPX 3756 & NASDAQ 12888.

2019 CLOSE: DJIA 28508 SPX 3231 & NASDAQ 8823.

2018 CLOSE: DJIA 23327 SPX 2506 & NASDAQ 6635.

AFUND Fair Value GOLD $1844.

Reduce Risk and Focus on Capital Preservation:

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

The Astrologers Fund2021 Stock Market FORECAST update

HW: Outside of special situations we do not plan to add positions until after the Fall equinox.

For our next market update attend Our upcoming September 22 Webinar.

General Advice

  • Review your Portfolio Holdings for possible changes.

  • Prepare a list of GOOD stocks to buy AFTER a 15-20% correction. Choose your favorite stocks and patiently bid for them.

  • Stock selection is important. Include some stocks sporting strong cash flows, sound balance sheets & growing dividends.

  • Include some investments that can benefit from higher inflation such as gold, TIPS, utilities, Art/Blue Chip collectibles and selective real estate etc.

Favorite H2 2021 Sectors:

Entertainment, Mining, Technology [AFTER a 20% correction if Undervalued & Highly Scalable] & Distressed Investing (select Real Estate) Currently reducing Health Care (except select lower cost/better outcomes).

Gold has entered its favorable seasonal cycle. Algos please note inflation is a positive not a negative for gold investors.

Note: One can only imagine when Bitcoin meet reality, how it would likely to usher in a rapid source of many new gold investors.

Gold Fair Value is $1844 with $1750 support and $1850 & $1925 overhead resistance.

Silver Fair Value $26 with support tests continuing to be an opportunity for long term accumulation: $23 Support & $30 overhead resistance.

There are many good buys in the precious metal space depending on your time frame & risk/reward desires.

See recent AFUND luncheons, conferences & past Webinars have been posted on our YouTube channel] for some investing ideas that may be profitable in 2021.

Gold: Fundamentally the global political and economic situation is very favorable for gold but mixed for Silver (as also an economic metal).

Precious metals remain favorite sections. More generalist investors now have some interest in Metals and Mining.

Note it is under allocated by most investment programs, this gives it even more potential room to run, especially as inflation fears resurface &/or if US dollar weakens!

Hence, we recommend a full and over weighted precious metals portfolio allocation.

However, we advise long term precious metal investors to also pay attention to stock selection.

  • 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!

  • Once again, some investors are hedging record equity prices by buying gold.

  • Low real interest rates is positive for gold as well as low global bond yields makes gold an attractive alternative risk mitigation hedge.

  • We expect precious metal stocks to outperform physical gold & silver in 2021.

Gold FV $1844 = Commodity FV: 1680 + Currency FV: 1812 + Inflation Metal FV: 1844 + Crisis FV: 2040.

INVESTORS: We will stay LONG in H2 2021 both as an investment and as a portfolio hedge.

SEASONED SPECULATOR picks: On Hold

Many picks are best for speculative portfolio allocation and as such bought as a member of a group of 5 to 10 such stocks.

Remember NOT to ignore potential High Risk - meaning use speculative allocation i.e., “money you can afford to lose without altering your lifestyle.”

Always do due diligence before deciding to act.

Quote

“High valuations have increased market fragility. If there is a new negative development, it could generate growth shocks that lead to rapid de-risking.”

Christian Mueller-Glissmann, managing director of portfolio strategy, Goldman Sachs.

HW: Yes.

“It’s the next six weeks in the market that I have the greatest fear of."

Phil Blancato, chief executive officer, Ladenburg Thalmann & Co.

HW: Just six weeks?

"The market is taking a breather. Investors are looking for some outsized news or information that is beyond the band of expectations, something much more outsized, positively or negatively, that will give investors better visibility into how things are going to look for the balance of the year."

Greg Bassuk, CEO, AXS Investments.

HW: If markets do not move up, they will go down given overvaluation and multiple technical and seasonal warnings.

On the web

Investors are ignoring the parallels between stocks today and ‘heady’ years of 1929, 1999 and 2007. Do this next, says strategist. Investment Banks Turn Sour on U.S. Equity Outlook stocks-could-be-due-for-a-correction-of-up-to-20-by-fire-or-ice-morgan-stanley-strategist

Letters

THIS LEFT INTENTIONALLY BLANK.

The Astrologers Fund (AFUND) is not a registered broker dealer, CTA or a registered investment advisor. Past performance does not ensure future results, and there is no assurance that any of the Astrologers Fund's recommendations achieve their investment objectives. The Astrologers Fund Inc. makes no claims concerning the validity of the information provided herein, and will not be held liable for any use thereof. If you are dissatisfied with the information found on this website, your sole and exclusive remedy is to discontinue use of the information. No information or opinion expressed here is a solicitation to buy or sell securities, bonds, futures or options. Opinions expressed are not recommendations for any particular investor to purchase or sell any particular security or financial instrument, or that any security or financial instrument is suitable for any particular investor. Each investor should determine whether a particular security or financial instrument is suitable based on the investor's individual investment objectives, other security holdings, financial situation and needs, and tax status. Past performance is not indicative of future results. Contact The Astrologers Fund, Inc. 310 Lexington Avenue Suite #3G, New York, N.Y. 10016 Email [email protected] 212 949 7275 [email protected]

Feed news

Latest Forex Analysis


Latest Forex Analysis

Editors’ Picks

EUR/USD rebounds to 1.1350 on modest dollar weakness

EUR/USD regained its traction after declining toward 1.1320 during the European session and rose to 1.1350 area. The dollar's is facing modest selling pressure amid falling US Treasury bond yields and allowing the pair to continue to edge higher ahead of the weekend.

EUR/USD News

GBP/USD struggles to pull away from 10-day low set near 1.3550

GBP/USD fell toward 1.3550 on Friday and touched its weakest level in 10 days. Although the US Dollar Index stays in the negative territory in the early American session, the risk-averse market environment doesn't allow the pair to stage a convincing recovery.

GBP/USD News

Gold reclaims $1,840 amid falling US T-bond yields

Gold reversed its direction after testing $1,830 earlier in the day and turned positive on the day above $1,840. The benchmark 10-year US Treasury bond yield is losing more than 3% at 1.75%, fueling XAU/USD's rebound.

Gold News

BTC may capitulate to $30,000

Bitcoin price has dropped considerably over the last three weeks. The recent downswing has made things worse for BTC and hints that a steep correction could be on its way.

Read more

Will the Netflix stock price rebound?

Netflix stock edged down after better than expected Q4 results. Will the Netflix stock price rebound? Expectations of rising subscription and higher prices are bullish for Netflix stock price.

Read more

Majors

Cryptocurrencies

Signatures