Dear Members,
Tense moments, many members said that, ‘Mahendra, we may soon lose faith if the markets don’t turn around the way you see.’ It is difficult for me as well, as the whole world is talking about the bull market of metals and a weak trend in USD. It is difficult to speak against a trend which is not confirmed by any major financial news media, fundamentals or market feeling.
Last Friday after USA opening we got one of the most convincing confirmation that in the coming days the market would trade the way we see. Last Friday dollar gained strongly; precious metals and base metals showed signs of weakness; oil gave up gains in a big way and the soft commodities were falling exponentially (orange juice come down more than 8%), cotton remained limit down, sugar came down by more than 10% in two days and grains came down sharply as well. On the same day the stock markets struggled, they were trying to fight back but gave up gains.
At this stage almost all investors and the investment community is watching our predictions of rise of dollar and the fall of gold prices. We are not at all afraid of our recommendation of weak trend in gold/silver and rise of dollar. I will be a very satisfied person if both predictions come true in coming days as well as in 2010 because we are saying that the weak trend in gold/silver/copper will remain until October 2010.
I will be reaching Mumbai tonight before I leave for New York to give the final shape to our new energy fund called, “The Five Elements”. The fund will be focusing on Uranium, Nuclear, solar, hybrid, water, agriculture and electric component, power transmissions, power conversation and power conductor stocks. Half of the money will be invested in future’s, options and ETF’s. We are creating unique investment strategy.
Before we start this week’s newsletter I will like to remind you to, stay invested in alternative energy as well as in US Dollar. Avoid trading in metals and metal stocks. It doesn’t matter how much you love the metals because if you stay invested in this area then you can lose that you made in the last eight years.
Also avoid trading in grains for another two weeks. Energy sectors will keep moving down in coming days. Soft commodities will perform very badly.
At this stage dollar will come back very strongly. In the longer term gold and silver are in our favorite list but we will stay away from them until valuation attracts us and time gives approval for us to go ahead with it.