Weekly Newsletter from 26-30 October
Get ready for 0.25 basis rate rise or hawkish comment from FED
Dear Members,
Last week was one of the best weeks for traders and investors; in fact it was one of the best October’s in market history. Three weeks ago we mentioned that we won’t be surprised at all if October turns out to be the best month for stocks and so far that statement looks like coming very true. The market created fear by falling sharply in the end of August and remained Volatile in the month of September. This kept many serious investors on the side lines because they never had the vision of the future and when anyone is trying to read too much about the present situations they always remain unclear in their decisions and miss opportunities in the coming time.
In the last fifteen years I have constantly recommend our members to mediate every single day or disconnect with the noise of what is currently happening in the media and talks of all kinds of analysts, because we are aware about all these tools but we forget to recharge our brain, heart and soul to get clear directions. These three most unique and powerful tools (Soul, brains and heart) provided us by nature and they have unlimited power. You can travel millions of miles just sitting in one spot, you can dig into the future without any difficulty and the most of important, and you can fall in love with what you do. Ego, failure, anger, greed, excitement of success will go away, and you will enjoy limitless whatever you will do.
I know many will get confused and ask, “Mahendra, which tools should we use? Meditation or the astro cycle to have better feel about the market?” My answer is that the astro cycles are a purely scientific study but to bring this scientific study to life you have to give birth, and since birth without a soul is impossible, mediating or gathering energy plays the most powerful role in helping you put your heart and soul into any subject and then you can see that we can put life in any subject. I got the astro cycle subject from grandfather and loved it so much that it didn’t matter what I was doing (eating food, sleeping) or what was happening around me or in world. I kept mediating on why these events are happening, why this market is behaving like this, and why human behavior changes during different times and circumstances and how all these impact on outcome.
Over a three decades I have learnt that if you don’t find your centre point of your soul, your heart or your mind then you will always remain incomplete and you will be always sitting with unfinished sums. I am still incomplete, though the journey of my life has been very interesting. Your journey could be interesting one too! You can do wonders, you can make things happen if your intentions are right in the eye of nature. Humans always get carried away because they don’t find their center point and they lose their identity. Look at our planet, people kill others in the name of religion, even though they don’t understand the basic principles of that religion. Religion was born from a society, or as a way of living and represented a particular society during the old times with different looks and rituals, but then religion became a tool for powerful people and politicians to keep the crowd different from one another. We human lost our center point, we are supposed to be here to make better society but greed, power and ego took center place, today look at people like Mugabe still want to rule country when he not even able to think or act because he is 90 plus, ISIS want to kill people, Bashad Al-Assad want to remain leader of Syria even though whole country is falling apart in front of his eyes. Meditations always help to make right decisions, it helps to quite because ego, greed and power goes away.
I don’t want to go far from the financial market but surely I love to represent the truth about how I work so that you can have a better understanding of what we are predicting and why we are predicting it. If my predictions makes you money then you must help needy.
When the market was falling in the last week of August and September, we remained very positive about our outlook of the market. We kept saying that this is the time to acquire positions in the market and we kept writing that S&P would hit a historic high. Most of you are aware that we don’t predict a positive outlook because we like the stock market or because we already predicted bullish trend and now we want to support that predictions with selfish motivate. Our prediction on oils fall was not because we hated oil; we purely predict what we see. I have been wrong quite a few times on our short term outlook for certain financial instruments, but we have accepted those error and after rigorously trying, we have improved our theory every time we were wrong so that it never happens again but still error will happen.
Since the middle of this year we kept recommending Microsoft, Amazon and Google because we knew how powerful a role these companies can play in the coming time. Do not forget that Apple has been one of our favorite stocks since 2013, and it too will play a very important role in bringing new technologies in our life. I have always noticed that short term market events leave us with so many good and bad memories, and these short term events control our decision power so much that many people are not able to build their bridge to success when time is there to build that bridge.
We are all aware that timing is everything, and at this stage the bull market which bottomed out in 2009 and started rising in 2011 won’t end its journey at this stage. This bull will enter the most exciting period of euphoria and a bubble, and this bubble and euphoria will get bigger because the larger crowd will go against the market. Many big people will go against the market, and during the rising cycle fear of the bull will keep damaging sentiments of the bear, and there will be a stage when hardly anyone will be left with bearish sentiments or short trades. We will wait for that time and hopefully we will be able to identify the end of the euphoria era, but until then remain positive about the market, hold your positions tightly, and we are sure that you will do very well in the coming time.
Last week our recommendation of buying Amazon, Microsoft and Google, did extremely well; but most importantly, our prediction of the market rising sharply also provided members with prudent returns. In the last one month MSFT moved up from $43.00 to $54.00, Google from $618 to $750, and AMZN from $492 to $622.
FED Decision: This week the FED will be meeting on Tuesday and Wednesday, and there are still chances that suddenly the FED can become Hawkish or they can hike rate by 0.25 basis point or their Dovish tone can disappear. Surely Aries moon can give an indication of a rate rise on Wednesday or if there will be any surprising move. Be prepared. Any sharp weakness after hawkish comments should be taken as a buying opportunity in market. If the market moves higher on Dovish comments (which we don’t see) and it fails to close above 2088, then it should be taken as a profit booking opportunity in the market for a few days. Once again, we do not see S&P going below 2038 so get read to buy positions in the market.
Here is this week’s newsletter from 26 – 30 October:
GOLD/SILVER/BASE METALS
Last week metals prices remained negative but metals stocks were holding value, in fact many metals stocks gained value during last week. Most of the metals struggled to move above our predicted astro resistance levels, and we still believe that gold will struggle to close above $1184, silver $16.05, palladium $725, and copper $248. Last week Friday gold traded sharply higher in European market but gave away all gains and close negative in USA trading sessions. Metal investors made money from 2000 to 2007, and 2009 to 2011 by buying and holding positions for longer term but that era is gone, and now you have to be smart metal investor or you have to become an opportunist rather than falling in love and holding positions for years which won’t take you any-where because metals bull market have ended in 2011/2012.
Precious and base metals are still in a weaker trend according to the medium and long term astro cycles, but for the short term, volatility will continue. As mentioned last week, from the 2nd of November, weakness could start in metals. Even though we are aware that most Indians buy some physical gold during the Diwali festival, which will be celebrated during the second week of November; this time buyers will find much cheaper prices, so there won’t be any rush to buy gold during this Diwali season.
On Monday we see metal prices bouncing back from lows and the same kind of trend is indicating for Tuesday. On Wednesday precious metals will start coming down from the higher ranges and this weakness will continue on Thursday and Friday. Selling is recommended on from Wednesday onward.
Compared to metals, metal stocks look like far better bets during early this week, but from mid-week you may experience some kind of selling pressure. On the higher side gold will still struggle to move above $1182, and on the lower side gold will test $1150. If gold starts trading below $1150 for three days will open to door for bear to enter and destroying every chart pattern.
Silver will follow gold, and some sharp corrections can take place in silver either on Thursday or Friday. Base metals will trade mixed, but weaker from the middle of the week. We are not recommending any buying in base metals.
IMPORTANT NOTE:
Precious metals have been in our favorite list, but since the last three years we have not been recommending any buying, and out view still remains cautious for those who would like to invest in precious metals for the medium to longer term. I do not know the exact timing at this stage, but surely at some point in 2016 we see precious metals moving 30% higher. Do not buy precious metals today thinking that they will move 30% higher, because the down side is still wide open for precious metals, even though most analysts and chartists are predicting a bottoming out in metals.
Here is Monday’s range: (December 2015 contract):
GOLD: $1171.50 to $1157.95
SILVER: $15.99 TO $15.71
COPPER: $239.00 TO $231.00
PALLADIUM: $703.00 TO $690.00
PLATINUM: $1018.00 TO $991.00
INDEXES
Last week most of the global markets gained nice value as predicted. What a turnaround in S&P from the 2nd of October when it was struggling around $1180, and on the same day post the nonfarm payroll the market turned around from that level and gained over 10%. In fact October remained one of the best months of the last decade. I am sure many of you must be feeling satisfied by following our view, because the end of August and September was so scary that many people even lost hope that the market could turn around. We believed in our theory and once again it proved to be the right guidance.
Most of you are aware that I have been holding S&P target of 3200, which we are predicting will happen by March or April 2017, so we have another 15 months in which S&P should gain almost 1000 points. I know it is very hard for you to believe that this will happen but our theory says that this will happen, so we remain firm and recommend investors to plan the next 15 months very well, do not worry about weakness in China or the emerging market, or do not think too much about the FED hiking rates, because all this noise will be buried under the bull astro cycle for the market.
Last week turned out to be the best week for USA stock investors. Giant stocks like Microsoft, Amazon, Google and many others moved up so aggressively, which provided handsome returns to many portfolios. These three stocks were our favorite on earnings, and for 2015, and they are still our favorites. Plan your calls in indexes, because the bullish trend has started from the 2nd of October as predicted, and the US market is just 2.5% below an all-time high, and once this market starts its journey towards an all-time high, the rally will be non-stop.
This week on Monday and Tuesday there will be a mixed to sideways trend, but buying may continue around the lower side, and key stocks will keep moving higher, so do not hurry to book profit. On Wednesday the market will trade in a mixed trend. On Thursday and Friday we may see some aggressive moves on both sides so trading in and out will be the best strategy.
The Emerging market will trade slowly and in a mixed trend during this week, but keep adding emerging market ETF’s.
European markets performed extremely well during last week, and this week most of the European markets will hold value.
S&P is trading around the most important level, and if S&P closes above 2088 for three days, then our next target is 2260 to 2395 by the end of the year. On the down side S&P will have a strong astro support at 2038, so this is a great buying level if S&P comes down to it. NASDAQ will remain very hot, and commodity stocks will follow the market.
We are not recommending any shorts around the higher level in these markets. Surely, booking some profit won’t harm your portfolio.
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Thanks & God Bless
Mahendra Sharma
Was sent on 25 October 2015, 3.00 PM Santa Barbara