Today's Trade & News

Dear Members,

Most of the people say that, I am always early in my predictions on financial market, after meditating and talking to my spiritual guru, he says “predictions has to be early that is why its call predictions” and last week in New York my friend James said the same thing to me. I never thought on this before, I was always thinking that why I am always early, why I couldn’t come with prediction on same day but now I found the answer after twenty years but still I wouldn’t like to come months early, I will be very happy if I come few weeks early.

I am my on the way from New York to Mumbai. Last week all three central banks—EU, UK and USA announced unchanged rate decisions. In the last six year I have seen that during rate decision weeks, metals always moved up and this week they did the same. Prices of gold touched all-time high but other metals including metal stocks are still far below from the highs.

One of our close friends from India said that Indian markets require gold because a few ETF’s were just trading on paper without owning much physical gold that is why they order gold through central Bank of India and MCX (third largest metal trading exchange in world) require gold for the delivery as lot of arbitrage and hedging trades are taking place in the country by big institutions and retail investors. Also many banks attracting investors to sell gold coins, as they are aware about common men interest toward gold. We don’t know if this is true but if it is then we are heading toward another unique scandal. People are buying ETFs thinking that they are buying gold but this information would surprise many metal investors. Anyway we don’t want to go too much into these rumors because our job is to predict trend.

Overall outlook for gold:

We were not accurate at all on last week’s gold trend. One thing very clear is that 2010 gold will trade weaker. From here till mid May all metals will trade weak and I won’t surprise at all if gold hit $550 weeks. Whole 2010 move will move down for more than one year like oil did after touching $145.

Those who don’t want to take risk should buy Sep/Dec 2010 puts by the end of year.

In current market condition calls and puts are becoming very valuable because of increasing volatilities. Let me give you a personal example. In early 2002, I bought calls of huge quantities (millions of ounces) of silver with expiration on December 2004 because I was very sure silver reaching $15. Yet if I had bought December 2005 calls, I would have made money more than anybody can imagine. Sometimes a few trades can make returns beyond your imagination if your call on market is right for six months or one year in advance. As another example, how much would one make if in the middle of last year he or she bought oil puts at $50 when it was above $100? What about our accurate calls in February this year on strong market rebound, and last year’s accurate call on dollar’s surge? You don’t have to make money every day. Just trade 10 times a year with full faith on our longer term predictions and I am sure you can’t lose even a single dollar!

Everyday is a learning experience in our life, and current market conditions teach us that trade on a longer term basis makes far more sense. Short term trades create more excitement but they are dangerous as they bring about greed, and they take away big part of your daily life because many people would just sit hours and hours in front of the screen. 

Yes, many times great short-term trade comes but they don’t come everyday. I write weekly newsletter but our newsletter is feeling the market. We give weekly predictions but let me remind you again to avoid making mistakes by trading blindly on our predictions without putting stop-loss. There are simply too many short-term interferences but longer term market forces follow nature, always. Like last week we said very clearly that we won’t be trading metals at all at this stage because they are in final phase of bull market and crash will be severe in gold in the coming time so we don’t want to make money on five to ten percent up move but we do want to make money when it move down more than 40% percent. That’s the whole game. 

Bull v/s bear call:

I know oil took almost eight years to move up from $15.80 to $145 but coming down from $145 to $32 took just six months. History is witness that any rise takes seven times longer than its eventual fall. So, smart traders also make money if they are right in calling bear markets. But to call the exact top is the most difficult job and under this condition buying puts is a great way to take advantage of the trend well in advance. I know a few of our members adopted this strategy and many can try. You have to have patience to make money because puts and call doesn’t make money over night but if your trade is right you will make money without the fear, tensions and troubles from short-term trades. 

Our new hedge fund—“5 Elements Global Fund”—will also employ similar long-term strategies that aim to both preserve capital and generate outstanding returns, and I am sure we will make noise in a few year in Wall-street. 

I will be writing more on put and call trades in our newsletter going forward because it minimizes risks and at the same time you can take advantage of the longer term trends. 

Except gold and stocks the rest of markets did trade as predicted. Great time is coming in grains. Gold killing its self by falling into the hands of speculators and this is the final phase of its bull market like oil last year. Traders should trade carefully in metals, plan to buy puts. If you trade in futures markets then trade with stop-loss. Also we all must remember that all bull markets ends at one point and then they takes years to come back to the same levels, and this also applies to metals. We predict gold will come down to around $550 in 2010. Is anyone there predicting the same? Maybe not. We do because we trust planetary movement and they never let us down. Current trend has trapped many short sellers and until each and every short seller goes out of the trade gold may keep rising for the next five weeks from December but we don’t recommend any buying, short term trader can trade on our recommendation but my warning on metals is very much in. 

WEEKLY NEWSLETTER FROM 9-13 NOVEMBER 

GOLD/SILVER

This week gold and silver will start with a weak trend on Monday after touching high of 1103.80 and silver $17.55 but surely from late Tuesday both metals will gain handsomely. Gold may hit new highs and silver will also move new highs of 2009.

This rising trend will last till Thursday morning in Asia so one can take a short position on Thursday morning because later in the day Gold and silver will move down sharply and this weak trend will continue until Friday.

Trading range for gold will be $1,107.80 to $1,084. Silver will trade in the range of $17.68 to $16.80. If it break 1107.80 and trade for more than two hours above this price then gold may hit $1123.80 and silver $18.18.

Important note: If gold and silver don’t trade positively on Tuesday and Wednesday then I see that short term top has achieved and from here gold and silver prices will move down in the next three weeks. Metal stock will move down sharply as well. Watch Tuesday and Wednesday trends closely. I will send updates.

Short term trend (Six weeks): Down with Volatility

Medium longer term trend (One year): Negative

COPPER/PLATIINUM

This week copper will trade weakly on Monday but try to gain with gold on Tuesday and Wednesday. From Thursday copper will move sharply lower on some negative news. Platinum will follow copper.

Tuesday and Wednesdays trend is important for metals so if they trade weakly then sell these metals fearlessly. If they trade positively then I see sideways trend for copper and platinum in coming days. I still see copper unable to hold $303 and from here it will fall.

STOCK MARKET

Last week we saw volatility in all major stock markets. All major Markets will trade sideways on Monday and Tuesday. On Wednesday markets will gain but won’t be able to hold gains on Thursday and Friday. Negative period will continue for the next six months before historic bull market starts.

Markets have surprised me by not moving down after 13 September and they have been absorbing the negative cycle. I still don’t recommend any buying before the end of the year. Hold cash as a great opportunity is on the way, Yes in five year I see Dow reaching 32,000 so from next year start accumulating long positions.

Still four negative weeks are pending so one can buy short term puts and can sell markets and stocks with stop-loss in all major markets for the next one month.  

Stay away from European markets and Asian markets for the time being. This week is best time to avoid new trading except one can buy power related stocks.

Short term trend (Six weeks): Weak, Dow will move down from 10300

Medium term trend (One year): Sideways in 2010

Longer term trend (Five year): Bullish, Dow should hit 32000

COFFEE/COTTON

This week weaker trend will continue in both of these soft commodities. I recommend selling coffee and cotton on Tuesday and hold your short positions. We expect more than ten percent fall in both of these soft commodities.

Short term trend (Six weeks): Weak

Longer term trend (three years): Bullish, coffee may touch $500

SUGAR/COCOA

Best time has come to sell cocoa and sugar. I am sure our members are following all our areas of recommendations. If you have future accounts then trade on a few different recommendations so you are not putting your whole energy in only gold or oil. For example, in the past weeks I made good money in coffee and Treasury. At any rate diversify your trading portfolio appropriately.

Both these soft commodities has enter into longer term bear markets so holding short or buying puts will make money. Trading range for cocoa will be $3,055 to $2,820 and sugar $21.70 to $19.20. If sugar breaks $20 it will have sharp corrections.

TREASURY BOND

This week bond prices will move down from Tuesday so taking short positions on late Monday or early Tuesday will bring some good returns.

Our trading range is $120.90 to 1.1790.

GRAIN

Our profit booking recommendations in grains made us good money. We will add more once we see that strong rising trend starting in grains. This week grain prices will remain stable or bit up trend on Monday and Tuesday, but weak trend will dominate again from late Wednesday. Thursday and Friday grains will trade sideways.

At this stage one can buy some call option of September 2010 on Wednesday in corn and wheat.Buy corn, if it comes to $345 and Wheat $445. Avoid soybean and meals as they are in weak astro cycles.

Short term trend (Six weeks): Sideways

Longer term trend (three year): Very bullish for corn and wheat, 

OIL

Last six week astrology has guided us very accurately on oil and natural gas predictions. This week we see oil moving up. Soon we will recommend buying natural gas and selling crude oil from the middle of this week.

Last week oil traded as predicted, this week Monday we see rising trend in oil and rising trend will remain till Tuesday morning.

Wednesday weak trend will start and weak trend will continue until Friday so trade accordingly. Selling on Tuesday or Wednesday will make money for you.

In the last six weeks planetary positions guided very accurately on natural gas. This week we see natural gas bottom out by Thursday or Friday so time has come to accumulate natural gas. Trading range will be $4.35 to $4.83 and on weakness one should buy. 

CURRENCIES

Since last three months dollar index has trapped in a narrow range of $77.95 to $75.20. Excess liquidity of dollars saved the world financial system from collapsing and yes dollar paid the price for that. I neither love nor hate dollar. I just predict what I see in planetary movement. According to my astro calculations of 2001, we predicted of fall of US dollar from 2001 to 2007 and from 2008 we saw bull market for US Dollar till 2014. I still believe that our last call of dollar turning around from 72.00 last year, and fall of oil and commodities would be one of the best predictions astrology ever gave me.

This year we call for a new bull market of stocks and longer term we still hold our prediction of Dow to reach 32,000. In the meantime I hold another most unique prediction that dollar index will hit 200 mark.

There must be some reasons for dollar to hit 200 because if dollar hit 200 that means Euro and British Pound are both going to 0.50, while many other currencies will touch historic lows. At this stage I don’t know many reasons but one reason I see is that EU might be falling apart economically and may all other currencies will follow EURO.

This week USD will again try to turn abound, Tuesday and Wednesday Moon’s transiting from house of Leo will give rebirth to USD. This is the best week to buy USD and sell British pound.

Australian and Canadian dollar will also move down. Swiss Franc will turn bearish also but Yen will remain in a positive trend so you can buy Yen against all currencies.

Short term trend (Six weeks): Upward trend

Medium term trend (One year): Bullish outlook of USD in 2010

Longer term trend (Five year): Bullish, Dollar index can hit 140 to 200.

Best trade of week:

·        Sell Coffee, copper, cocoa

·        Sell oil on Tuesday morning

·        Buy Dollar index around 75

Avoid this week:

Ø DON’T TRADE gold and silver or trade with stop-loss, major fall is on the way but before fall comes we may see volatility on upside

Ø Avoid grains and stock market, hold cash

Longer term trade (one year):

v Buy puts on Markets and metals

v Buy calls in Grains and Dollar

We will buy stock markets during middle of next year and gold and silver toward end of 2010.