Financial astrology for the successful investor and trader

1. JANUARY MARKETS                                                                   

2. UP STARS/DOWN STARS

3. GOLDEN OPPORTUNITIES                        

4. QUOTES

5. ON THE WEB

6. LETTERS 

 

1. We repeat: Unlike 2018, Markets in 2019 will NOT be easy to forecast - requiring both a longer investment horizon AND a shorter trading one!

• WE ALSO BELIEVE MARKETS WILL CLOSE HIGHER IN 2019 than 2018! Additionally,

• We expect it to TRADE ABOVE ITS 2017 CLOSE &

• Be defensive H1 2019 (esp. Q2); Be more aggressive H2 2019.

 

Our 2019 recommendations:

• Be Selective - Stock Picking will outperform Index Investing

• We continue to recommend trailing profit stops and hedging, raising cash and/or writing calls to promote sound sleep.

• New trades & investments best in Long/Short Pairs in H1 2019

 

While many “concerns” are simply, three we are watching are:

1. The market’s short term reaction to trade wars;

2. China Internal & External response to its 2019 Saturn influence;

3. The January FOMC meeting anticipation & reactions.

 

BOTTOM LINE

WE THINK MARKETS WILL REACT POSITIVELY TO #1 & 3 NEAR TERM, BUT THERE IS CONSIDERABLE RISK WITH SUCH A BET.

HENCE WE ADVISE INVESTORS TO BE LARGELY CONSERVATIVE & DEFENSIVE, ESPECIALLY Q2 2019.

 

Proper Valuations:

• TIPS  ~ 110

 

IMHO “Improper” Valuations

DJIA < 24000

US 10 Year Bond  <2.75

OIL < 55

COPPER < 3.20 

BITCOIN > 2500

GOLD < 1375

SILVER < 18

 

TRADING NOTES

January is potentially an up month but also with potential major hiccups: given a strong US economy and a mixed horoscope for President Trump in H1 2019.

DJIA, NASDAQ & SPX can rally again as THE US TRADE WARS ARE WON and especially if the FED relaxes as it now seems more willing to do!

Remember our Trading Plan: Not to short aggressively before May 2019. 

 

TRADING HEDGES: 

Sell Oil 73.50/Buy Copper  2.95

Oil unwound 68.00 Resold 72.50 Unwind 64 Long 50

Sell Oil 74.00/Buy Copper 2.83

 Oil unwound 66.20  Resell 74   Unwind 66 Long 50.50

Sell Oil 73.33/Buy Copper 2.75    

Oil unwound 68.20  Resell 76  Unwind 68.65 Long 46

 

Buy Gold 1188/Sell BTC 6380

Buy Gold 1182/Sell BTC 6650

Buy Gold 1196 /Sell BTC 7370

 

Long Copper 2.70/Short BTC 6666

MARKERS	DJIA	SPX	NASDAQ	SILVER	GOLD	COPPER	BONDS	OIL	BITCOIN
2018 CLOSE	23327	2506	6635	15.64	1281	2.63	2.65	45.41	3768
1/04/2019	23433	2531	6738	15.73	1286	2.67	2.66	4825	3840
PIVOTS	23067	2484	6635	15.50	1270	2.68	2.65	45	4000
SUPPORT	23067	2444	6335	15	1250	2.68	2.65	44.49	3600?

 

KEY DATES:        January 7, 20/21

DJIA:                    Trading Target 24719

SPX:                     Trading Target 2673

NASDAQ:             R1 6903

GOLD:                  R1 1300 R2 1325  R3 1350

SILVER:               1500 SUPPORT R1 15.50 R2 16 R3 18

OIL:                      R1 50 R2 55  R3 58 R4 60

COPPER:            STEADY ACCUMULATE: H2 2018-2019 à3.50+

US 10 year          Sell/Distribute 2.75 OB

BITCOIN:             4200 RESISTANCE S1 3800 S2 3500  S3 3000  S4 2500 H2 2018 à 5000 OL BULLS EYE!

The Market Marker remains some cautious concern.

 

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 $1370

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

2. We are only looking at SPECIAL SITUATIONS this week awaiting CHINA TALK LEAKS & PRESS RELEASES.

3. We continue to recommend Maximum Allocation to precious and base metal investments for the intermediate and long term, given that the precious metal sector and copper are obviously very undervalued!

Now with lesser headwinds from US interest rates rising as well as less competition from MMJ & Bitcoin “investors”.

Given last week’s $1300 price, a $1350 ($1400) target test in 2019 is now closer to reality. Still, we advise patient precious metal investors to pay attention to stock selection as a slowly rising tide does not float all boats equally.

• 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 $1368 = Commodity FV: 1340 + Currency FV: 1368 + Inflation Metal FV: 1368 + Crisis FV: 1400.

Gold/Silver ratio à 75  Silver FV $18+.

INVESTORS: We plan to stay LONG in 2019 (recommending a precious metal sector hold rating and only hedging and/or selling Q2 or profit taking).

We remain disinclined to short or sell until gold is overvalued e.g. $1400-1450. For silver our first selling numbers remain $20+.

However, shorter term, after the Chinese New Year, some hedging or profit taking/protection will not be unwarranted.

 

4."This is a very strong jobs number. It tells us we're nowhere close to a recession."

Michael Ning, chief investment officer, PhaseCapital

HW: Currently 1.8% (1.5-.2.5)?

 

5.Take Five: Be careful out there! World markets themes for the week ahead

Worried about stocks? Remember ‘V’ means victory

 

6. THIS LEFT INTENTIONALLY BLANK

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