Financial weekly Newsletter
Dear Members,
Many currency traders may have felt trapped last week in the battle ground of a raging war and unable to extricate themselves from the situation. For those who were holding the USD, the situation was bleak and hopes were dim but thanks to the planets, Mars, Mercury and Venus combined to rescue the USD. There will be options expiry this week and few powerful traders may try to push prices against the currency market trend, but we don’t foresee this kind of situation again for the next five years once currency traders survive this week.
As we are all human, sometimes our ego takes the better of us and we become arrogant. At such times, our ignorance level also becomes high as we block any point of view contrary to our own, and it is at this time that nature comes in and teaches us a painful lesson. This punishment comes to bring us down from our self-constructed pedestals, and it has happened to me and many of you as well. Whenever I have gone against nature, either willingly or unknowingly, I inevitably got punished. Many of you have experienced times when nature comes in and metes out some form of pain or punishment. Gold becomes pure by going through fire; in other words, one must go through pain in order to become better or pure. A woman must go through pain in order to give birth to a child and become a mother (a complete woman). This is the way of nature and we must therefore bow our heads at the feet of nature and ask for forgiveness and strive to avoid similar mistakes in the future.
I just make predictions and show the path in the financial market by identifying the wave of nature and the onset of new trends. We are grateful to nature for this role, but once a year a time comes when we have paid a heavy price for walking independently or ignoring nature.
There are two things about which we are certain thanks to the guidance of nature; that is one of the biggest bubbles in the stock market (especially in power related stocks and alternative/uranium/nuclear energy), as well as the bull run of the Dollar are on the way. Indeed from here we should be trading with minimum leverage so that even if the Dollar comes down to 78.00 or 75 one should still be able to hold position. We are also calling-off my short term prediction of market off, and those who bought stocks three months back should be booking profit because a better opportunity is coming back to these stocks in the following months. After three months we shouldn’t look back because as we want to go all the way till the DOW reaches 32000 to 38000.
Meanwhile, one should closely watch Uranium stocks, solar, fuel cell, nuclear related stocks, power contractor and geo thermal etc.
Here is this week’s financial trends and outlook from 8-12 June 2009
CURRENT OUTLOOK
At this stage the market valuation is not as attractive as it was in February/March 2009, when we kept recommending that members buy stocks and indexes fearlessly. Today if you look back at the trend of the last three months you will realize how astrology can be helpful in making important investment decisions. Current planetary movement indicates that prices of most stocks won’t go anywhere from here as most planets don’t support stock market trend. The North node is currently in command and we may therefore see volatility in the market. However, in a few weeks markets and prices will be falling or in a sideways trend. Indeed, we expect a 10 to 18 percent fall during the next three months, therefore prepare and get ready to accumulate good stocks.
Currently the Dollar has shown signs of recovery from the drastic fall of the last three weeks, but we expect the trend to remain a little uncertain till 16th June. After this date the Dollar will be a one man show, therefore plan your trades accordingly and await the one of the greatest bull markets. The current weak trend in the Dollar is not crashing, but an adjustment in prices. It is a short term bear cycle within the longer term bullish trend.
Many people are asking me the reason for the Dollar’s rise given that a bull market in the DOW is unlikely to bring about a Dollar bull market, but the opposite. Indeed, widening of the current account deficit, rise of other economic powers like China , India and Brazil, many countries are getting away from dollar, USA keep printing dollar and many other reasons don’t support the idea of a Dollar bull market. However our members must understand that our predictions are not based on economic indicators or current market trends. Our predictions are hundred percent based on the hidden wave of nature which brings forth new trends in the world financial market. This is not to say that I don’t understand macro-economy or pay attention to it. I have studied commerce and very well understand the economy, charts and other data, but I don’t include these factors when talking about medium and longer term trends. What I am trying to say is that one should invest with the medium and longer term picture in mind and we are confident that the Dollar and DOW will pay you handsomely in coming time.
Important Note:
Jupiter’s retrograding from 15 June will give birth to a new trend in all major markets. From this date many markets will start moving in the opposite direction so each trader in the financial market should watch these 48 hours (after 15 June) very closely. The trend that will develop in the 48 hours will continue for a few months.
GOLD/SILVER
Last week gold and silver never closed above the previous weeks high and this indicates that on the higher side there will be a very strong resistance for gold at $990 and silver at $16. Last week we recommended people to get out from their holdings in gold and silver stocks and we have noticed that HUI and XAU indexes made a huge U turn in Thursday and Friday.
This week gold and silver will remain sideways on Monday and Tuesday but the weaker trend can develop from Wednesday onwards.
The trading range for gold will remain at $967 to $942, and for silver it will remain from $15.57 to $14.80. If prices break either side of above mentioned prices, then gold and silver will move in that direction for more than three percent.
COPPER/ PLATINUM/ ZINC & ALUMINUM
This week all the base metals will start trading weakly as compared to precious metals. All the base metals stocks will also have a very negative period. We recommend selling steel, aluminum, platinum and copper stocks, as we see more than 5% fall in copper and platinum. Aluminum and zinc will trade sideways. There will be a bit of recovery in the base metals on Tuesday and Friday but there will be sharp falls on Monday, Wednesday and Thursday so trade accordingly.
Last will top has been achieved in copper and platinum, we won’t see those prices again after this week at least for the next five months.
COFFEE & COTTON
We expected there to be a weaker trend in coffee and cotton last week and it traded accordingly. During this week we see a weaker trend in both of these soft commodities. The trading range for coffee will be $138 to $131 and for cotton it will be $56.80 to $54.20. From the 15th of June if both of these commodities start moving up then we may recommend buying them but until then stay away from both of these commodities.
SUGAR & COCOA
This week sugar and cocoa prices will remain weak from Monday onwards but there will be a recovery in the prices of both these commodities from Thursday morning. We will watch Thursdays trend and will update accordingly.
STOCK MARKET
This week we see a weaker trend in all major markets. USA stocks will try to hold on the gains. As we have mentioned above that the 15th of June will be a very important day for the markets. It confirms that there will be a weaker trend in the stock markets and that sideways or weak trend will continue for the next two and half months so a great buying opportunity is coming ahead.
We have finally made the decision not to recommend anyone to have naked short positions without hedging in the market because we see a historic bull market ahead. So the best strategy will be to stay away from the current market and wait for the next two and a half months before you invest heavily in stocks.
Those who are already short in the market can hold their positions because the next two months trend will not be that encouraging. Short traders will make money without any doubt. From Monday there will be correction in Indian stock market, Hong Kong DAX and London. We expect these markets to correct 12% to 25% from here.
GRAINS
This week there will be a weak trend in grains from Monday to Wednesday. There will be volatility and the prices may sharply recover from the lower side. Those who are making short term trades on Monday or those who are already short in grains can hold until Wednesday.
Time is coming for one of the great hedging trade in grains and that will be - buying corn and selling Soybean.
OIL
This is the final week for rising in oil. It should correct very sharply from here which we have been predicting since last three weeks. Those who are not worried about this week’s trend can hold their short positions as we see 25% correction looming on oil, heating oil and RB Gas. I am studying the Astro chart for the natural gas and it is giving a great buying signal but we will wait for another 5 to 7 days before we recommend accumulating natural gas. We see natural gas moving up more than 50% in a very short period.
CURRENCIES
Last week was very volatile for currencies and I can understand how tough it was for people who bought dollar. There will be volatility in the currency market during this week or one can say that the dust will settle down during this week and from next week onwards. One of the greatest bull markets in dollar will start after the recent second downwards wave.
The third wave which will start from the 15th of June for dollar will take dollar index near 3 digits or to 3 digits. This week there will be some profit booking in dollar during the middle of Monday but the prices will recover in the late evening. On Tuesday dollar will remain a weak and on Wednesday it will remain sideways. On Thursday and Friday there will be huge volatility in dollar and finally from next week dollar will enter into the bull market. This week is a great week to accumulate dollar without thinking too much and the trading range of dollar will be $82.30 to $81.10.
Thanks & God Bless
Mahendra Sharma, 7 June 2009