Wall Street Next Week: Financial astrology for the successful investor & trade

1. We are prepared to make a few shorts before Halloween, especially if the market is higher than now.

 

OUR VIEWS:

1. The serious economic damage of the Covid Crisis fundamentally favors the bear case; there are also countervailing forces to keep markets elevated into the election. We have recommended 50% portfolio protection, high cash levels and overweight in precious metals.
2. 2021 POST ELECTION INVESTMENTS WILL BE TARGETED FOR A POST COVID-19 WORLD:

TRADERS SHOULD DAY TRADE OR HAVE VERY DEEP POCKETS;

1. Elevated Volatility = After hard rallies or market drops, it is smart to book profits. Wild swings can be commonplace.
2. DJIA 28,000, NAS 11,327 & SPX 3400 remain market support.  If markets are higher just in front of October 30-November 3 time period, we may take a bearish positional stance. If markets are ABOVE YTD highs earlier, we may cautiously step in selling as well.
3. Watch AAPL & TSLA: If/When these Nasdaq stars lose momentum, look out below! We don’t expect SPI type market action, but…..
4. We are and will be betting that the price of gold will be higher November 5 than last week;  Beforehand, it may drop lower.  Our trading plan is therefore:

Placing buy orders 1-3% under the market on physical and precious metals stocks OCO 10/29 or 10/30.

 

INVESTORS REQUIRE A LONGER TERM HORIZON THAN NORMAL.

Where appropriate, we recommend selling or placing trailing profit stops for many stay-at-home/Covid stocks that have been winners from this crisis.

We are planning a different strategy for the post November US Presidential Election.

Aggressive investors will wait and watch to pounce on misunderstood wounded winners.

Regardless of your risk preferences, precious metals will continue to shine later this Fall!

TRADING: Our approach is to enter early and exit early, medium risk with good profits none-the-less.

P1 7/31 MOC:     DJI 26377 SPX 3271  NAS 10745

2020 YTD Highs: DJI 29568 SPX 3588  NAS 12074 

 

Commodity Trading:

Gold + Fall Astro, ++ Astro Nov/Dec  ADD over next 3 weeks.

It is possible Gold  $1880-1900 remain short/intermediate term support.

Silver Astro is generally positive $20 Support R1 25 R2 28 R3 30.

Copper 3.25+ Intermediate term target achieved 

Oil $44+ 2021 Target. This a modest accumulate for 2021 Post Election. 

 

2. Prepare a list of stocks to buy AFTER a correction

If this is not upcoming soon, then we will remain highly liquid and largely continue to protect our YTD profits.

Otherwise, we plan to only selectively add stocks in our favorite sectors e.g. precious metals, mining and entertainment.

 

Favorite H2 2020 Sectors:

Entertainment, Mining, Safety & Security & Technology (Undervalued & Highly Scalable)

Short term we are just watching Select Health Care (lower cost/better outcome) due to potential future political risks

However, longer Term, global heavy weights like JNJ and PFE will be safe and profitable harbors.

Stock selection is important. Whenever possible, we prefer to recommend stocks sporting strong cash flows, sound balance sheets & growing dividends.

Choose your favorite stocks and patiently bid for them.  

 

3. Copper snapshot: Eight companies with promising assets

HW: Copper until recently has been highly undervalued.

 

"Gold price can move higher, but you are going to see a lot more volatility as headlines shift back and forth.”

George Gero, managing director of RBC Wealth Management

HW: Precious metals will be flying November and December and little reason to expect them to fall out of favor in 2021! 

We plan to do a little last minute buys of Gold this week 1-3% under Friday’s market.

1. Despite being overvalued, with strong astro this Fall, owning gold and silver we believe should continue to well reward investors by 2020 Year end.

Given newbie gold investors have little knowledge of the industry and many are accustomed to Tech valuations, is there an upper limit to Gold or Silver pricing? Maybe not! Currently, Gold is in an 1860-2060 trading range.

Conservative investors can accept $2200-2300, while more aggressive gold and silver bugs are replacing their previous 2000+ gold targets with 3000+.

Silver $22 resistance is now support with P3 30 overhead resistance. Many analysts expect $30 Silver & 2000 gold by 2021 Metal Ox Chinese New Year.

There are so many good buys in the precious metal space depending on your time frame & risk/reward desires - the trend is MOST definitely your friend!

See WSNW & recent AFUND luncheons, conferences & Webinars for some investing ideas that may be nicely profitable upcoming Fall/Winter. 

Gold: Fundamentally there was a short term decrease in mine supply coupled with GREATLY increasing investor interest.

Please note gold is 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.

Given it is under allocated by most investment programs, this gives it even more potential room to run, especially if/when inflation fears resurface &/or if/with a falling US dollar!

We believe gold & silver valuations will largely sport well above Fair Value into the Year of the White Metal Ox (2021).

Just as they were 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 very positive for gold.

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

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

1. Gold remains cheap geopolitical crisis insurance.
2. 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!
3.  Once again some investors are hedging record equity prices by buying gold.
4. Low real interest rates is very positive for gold as well as low global bond yields makes gold an attractive alternative risk mitigation hedge.

Gold FV $1680= Commodity FV: 1600 + Currency FV: 1652 + Inflation Metal FV: 1588 + Crisis FV: 1880.

INVESTORS: We plan to stay LONG in H2 2020 with occasional hedging & profit taking.

Note: Our current Fair Value for Silver is ~$21. 

 

4. Starting soon, we plan on adding a new feature: SEASONED SPECULATOR. This will generally be a very high risk/high reward market pick.  These picks are for speculative allocation, recommended to be bought in groups of 5 to 10 stocks. Position size 10%-20% of your speculative allocation, i.e. “money you can afford to lose.

 

5."To some extent the markets are under-appreciating the likelihood of a Trump rebound here."

Karl Schamotta, chief global strategist, Cambridge Global Payments

HW: That is definitely our view.

"If you have a risk-off environment because of a contested election then you probably have vulnerability on those stocks that have done the best. Quite often in a risk-off scenario you often sell your big winners first."

Joseph Amato, president, Neuberger Berman Group

HW: Yes true.

 

6. Get Ready for an Eye-Popping U.S. GDP Number

 

7. READER: Do you mean to do all your gold buying by Oct. 28?

HW: If you are going to buy more gold this year i think best this [last]  [this] week and next,

READER: When will oil stocks become a good buy?  Everything else is too expensive!  I think one of your videos said astrology more favourable for oil next year.

HW: Yes, we see the average price circa $45 so whenever oil is $38 or less a good time to buy.  With a Trump win, Oil pops; if Biden wins, it could drop hard first.