1. JULY MARKETS
2. UP STARS/DOWN STARS
3. GOLDEN OPPORTUNITIES
4. QUOTES
5. ON THE WEB
6. LETTERS
1. Beware Of An August Market Decline - Henry Weingarten 7-2-20
Markets Can be nearsighted or farsighted = Vol
M/Mov the economy looks good, Y/Y terrible
Focus can shift from the Fed put to Covid to ?? = Vol
No matter August is coming & we played it again (and again) Sam at SPX 3150
Going forward, economic activity caused by the pandemic should bottom out with Third-Quarter GDP Bottom Bouncing due to Reopening Efforts. This recovery, however, will be uneven & while a faster recovery than in the past, it will NOT a super charged V. We see a U US economic recovery but stock markets NOT V, L or U but W.
Q4 GDP will highly depend on US election outcome.
For Q3 we project 8-10+% market correction from Q2 2020 close.
RECOMMENDATION: 100% Protection Before August.
2020 Market Close Target V1.0: SPX 3069 NASDAQ 9140
SOME KNOWN UNKNOWNS:
- US Politics (July & August - November ?)
- Oil Low oil prices are a positive for consumers and most businesses +
- Covid Vaccine/treatment/testing & Reopening Progress +/-
- Debt Defaults - (ongoing)
- US GDP Negative - (Negative Q2 2020 with High Unemployment )
- Rising (Record) bankruptcies H2 2020
- Stock Buybacks & Dividends reduced or dropped -
- China Risk elevated (– June)
- Numerous geopolitical hotspots (black & white swan events) –
The Good News this = Opportunity
OUR VIEWS:
- We have a short bias into August as there is HIGH risk in the market now until late Summer.
- POST SUMMER INVESTMENTS SHOULD BE TARGETED FOR A POST COVID-19 WORLD:
for a “Recovery” rather than “Quarantine” portfolio.
TRADERS SHOULD DAY TRADE OR HAVE VERY DEEP POCKETS;
- Current high volatility making directional bets dangerous.
- After hard rallies or market drops, it is smart to book profits.
INVESTORS REQUIRE A LONGER TERM HORIZON THAN NORMAL.
We are no longer accumulating but selling stay-at-home stocks that have been winners from this crisis.
We will be planning a different strategy for the post November US Presidential Election.
Conservative investors may prefer Water Utilities, TIPs or high quality corporate bonds and dividend-paying stocks
AT THE RIGHT PRICE, AND RIGHT TIME FRAME THE COVID CRISIS REPRESENTS DANGER & OPPORTUNITY.
Commodity Trading:
Gold + Fall Astro, ++ Astro Nov/Dec First buy 14.88 Second Buy 14.80 Sold 16.50 & 1580 Rebuy < 1600 OB
Silver Astro is no longer negative cf March/April) First Buy was 11.80 stop 17.20
Copper + This is a deep pocket H2 2020 or 2021/2022 hold Fully allocated from current & higher prices.
TRADING: Our approach is to enter early and exit early, lots of profit none-the-less.
We have a short basis into August: RISK 3150-3200 SPX REWARD 2900-2850-
2020 Market Close Target V1.0: SPX 3069 NASDAQ 9140
DJIA SOLD 26000
SPX SOLD 3150, 3150, 3145
NASDAQ SOLD 9940
The Following prices are comfortable INVESTING accumulation zones for us if/when next seen (late Summer?):
- DJIA 22500-23830
- NASDAQ 7500-8300
- SP 2600-2750
HYDE PARK SOAPBOX:
What could save the stock market in July? More government borrowing and Federal Reserve money printing
SAVE THE DATE:
July 15, 2020 2:44 pm ET AFUND 2020 Stock Market Update Online Seminar
KEY DATES: July 6, 30
DJIA: 24000 SUPPORT?
SPX: S1 3050 S2 3000 S3 2958 S4 2900
NASDAQ: S1 9800 S2 9500 S3 9000
GOLD: 1750 SUPPORT/PIVOT R1 1800 R2 1900 R3 2000
SILVER: 17.80 SUPPORT?
OIL: 38 PIVOT 42 RESISTANCE 35 SUPPORT
COPPER: 2.60 PIVOT
US 10 year WATCH
CNY WATCH
2019 CLOSE: DJIA 28508 SPX 3231 & NASDAQ 8823
2018 CLOSE: DJIA 23327 SPX 2506 & NASDAQ 6635
2017 CLOSE: DJIA 24719 SPX 2673 & NASDA 6903
2016 CLOSE: DJIA 19762 SPX 2238 & NASDAQ 5383
AFUND Fair Value: GOLD $1595.
Reduce Risk and Focus on Capital Preservation:
THINK TRADITIONAL SWISS AND PRESERVE CAPITAL: HEDGE AND PROTECT AGAINST DOWNSIDE RISK.
2. Morgan Stanley is bullish on Singapore stocks and expects 14% returns
HW: it is one of the few jurisdictions that will continue to benefit from the current global economic & political uncertainties.
Stocks Are the Default Choice In a World of Bad Options
HW: Yes, but Our current focus continues to be reducing portfolio risk:
Before Fall, we advise only buying special situations &/or accumulate very undervalued quality stocks for the long term.
Favorite H2 2020 Sectors:
Entertainment, Mining, Safety & Security & Technology (Undervalued & Highly Scalable)
We are intermediate term downgrading Select Health Care (lower cost/better outcome) due to political risk.
Stock selection is important. When possible, we prefer to recommend stocks sporting strong cash flows, sound balance sheets & growing dividends.
Choose your favorite stocks and patiently bid for them at “ideal prices” if seen again [August?].
Avoid margin and always remember that it isn’t over the Fat lady sings [August?].
3 “As real yields continue to move lower, it makes gold more attractive.”
JC O’Hara, chief market technician, MKM Partners
HW: More attractive than most bonds! Goldman Sachs current three, six and 12-month gold price forecasts are now $1800/1900/2000 and maintains its long December 2020 gold trading recommendation.
Seems like gold investors have more friends these days!
There are so many good buys in the precious metal space depending on your time frame and risk/reward desires.
Review past WSNW and AFUND luncheons & conferences for many good ideas that can be quite profitable this coming Fall/Winter.
Copper remains undervalued largely as a pawn of the US/China trade spat & Wuhan Virus.
Intermediate and longer term it is very attractive and longer term this remains a “deep pockets” BIG win.
Gold: Fundamentally there is short term decrease in mine supply COUPLED with increasing investor interest.
We note gold is generally under Highly favorable astrological influences late Q3 & Q4.
Longtime Gold bugs are happy that more generalist investors are beginning to join the party: In addition, many major brokerage houses have $2000+ price targets into 2021.
These views now seem achievable especially if/when inflation fears resurface and/or a falling US dollar!
We believe gold valuations will largely sport at or above Fair Value in this Year of the White Metal 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 & Winter, the astro is positive for gold hence we maintain a full portfolio allocation.
We advise precious metal investors to pay attention to stock selection but only selectively add until August.
- 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. They will not be unhappy.
Gold FV $1595= Commodity FV: 1532 + Currency FV: 1625 + Inflation Metal FV: 1455 + Crisis FV: 1768.
INVESTORS: We plan to stay LONG in 2020 (recommending a precious metal sector buy/hold rating and occasional hedging, selling or profit taking before the Fall).
We will be happy if allowed to BUY more Gold cheaper ideally < 1592 & Silver at that time.
4.“We want to be tactical. But the problem is, it’s easy to get out and you don’t know when to get back in.”
Yana Barton, fund manager, Eaton Vance Management
HW: I disagree: Use a combination of astrology & technical with a step in re-entry plan to “know when to get back in”.
“We like gold because we think that it's a very safe asset in a very dangerous world. That danger can manifest itself either in inflation or, in my view, taxation capital controls, all sorts of things. We see this very much as the foothills, not the summit of this bull market and gold and gold mining.”
Andrew Ballingal, chief investment officer, Ballingal Investment Advisors
HW: Hence the saying: “Only gold is as good as gold.”
“The uncertainty regarding this pandemic just fired up again, as infection rates continue to climb in key U.S. regions. In many ways, we will continue to witness a market that is ‘Covid-on, Covid-off.’”
Satya Paradhuma, director of research at Cirrus Research
HW: Yes.
5. June jobs report beats expectations—Five experts on what it means for the economic recovery
6. READER: Now that it is Q3, is Gold & Silver up thru year end? so buy all one plans to invest now or wait for another down turn?
HW: Unsure: For Stocks, selectively yes, especially by September . However, we don’t know how gold will trade in July or August. If it drops, we will buy more. If it continues with upward momentum, we may miss a little but that assumes we already own some gold or gold stocks.
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 Twitter@tafund
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