I have been in the market since I was 18 years old and many of my members have been trading for longer. This year I turned 40, but the market has been in existence for several generations. While technology has made trading easy and the market accessible, quick movements in and out from trade positions is resulting in too much volatility; and there is also too much money in the market. A lot of the money is in the hands of traders, investors and hedge funds, and there‘s therefore not much choice. Consequently, sharp rises and corrections are bound to happen and one must be ready for them.
Times are changing, and the era when people would to take a core position and hold it for a long period is disappearing with the previous century. The current pressure of buying and selling will eventually take over due to high fluctuations in daily and short-term trading. I don’t know if this will eventually prove too dangerous, but one thing is clear: in future the market will be akin to a highly sophisticated albeit respected gambling place where one will have to play his cards very carefully. My astrological research tries to unravel the birth of new trends as well as new trading patterns, and for the last few years my newsletters have emphasized about major volatility.
We need to place more focus on short-term trading as well as medium term while bearing the long-term trend in mind. Astrologically, the present volatility will remain until the second week of May 2008 a small error with a large position could be disastrous.
Before I start this week’s newsletter, I would like you to remember that the bull market in commodities will grow 60% weaker from 19th of May. This therefore means that its strength will be greatly diminished and we are unlikely to see a repeat of the 2006 and 2007 trends for commodities, currencies and other emerging markets for the next three and a half years. Indeed, there will be a bear market or a side way trend.
I write the newsletter to make you aware about some things, but many still feel that they miss out on some opportunities. The truth is that new opportunities are being born everyday and I would like to share them with you on a regular basis.
PREDICTIONS FOR 12 TO 16 NOVEMBER
GOLD & SILVER
We shall see a Negative trend for metals on Monday as well as on Tuesday. Buying is only recommended during weakness on Thursday closing. Indeed on buying side one should trade with a very strict stop loss because metals nearing a top out, after which we expect a major correction.
Thursday will also be weak, but the metals will recover during closing. On Friday the metals will become weak after a stable opening.
PLATINUM & PALLADIUM & COPPER
Last week platinum and copper went down sharply as predicted and they are poised to remain weak during this week. In actual fact, I do not recommend any buying at this stage for the next ten days. Copper has just declined more than ten percent and another ten- percent downfall is expected in the next ten days. The platinum bull market is over and one can therefore buy put options and sell calls. Palladium is to remain in a sideways and I therefore recommend no position.
All markets have been trading weakly as predicted and we do not expect any turn around in the near future in the European and emerging markets. USA financial or banking stocks have declined quite substantially but the transit of the moon in the house of finance will support them stocks for this week. One can therefore take a short term buying position in these stocks.
I expect a larger correction in the Australian, Hong Kong, Indian, Korean, Singaporean and Russian markets during this week. I also recommend international investors to cash in 80% of their investments from emerging markets, as this is a good period for winding up. There will be opportune time to buy emerging market once again early next year, but for a short period only. For the longer term, the Indian, Russian and Korean markets look quite interesting.
The European market will trade in a bearish trend for the next seven years and I am therefore warning European and international investors to watch their investments in Europe. European investors could buy alternative energy stocks in their countries, as the sector is likely to outshine all others. This week European markets are going to go down.
There’s going to be a short term buying opportunity next week, therefore hold your cash.
COFFEE & COTTON
Both these soft commodities will remain in positive territory and one should therefore hold position in them. Coffee should move up on Thursday and Friday and short term traders can therefore take up buying positions on Wednesday.
The bear trend in treasury bonds is right on the corner and I expect weakness from Wednesday in 30-year bonds. Be therefore advised and take position accordingly.
ORANGE JUICE & SUGAR & LUMBER
All these soft commodities have traded as predicted and they are currently in an uncertain trading zone. This is mainly because there is no major support from any planet except for sugar, in which there will be a sharp upward move. One should therefore be ready to load up the boat for sugar by this Thursday or next Monday.
The soy bean market is trading in a zone of high risk and a major correction cannot be ruled out any time this week. Last month in the first week when wheat was trading at historic highs, I warned about the trend in wheat trend. Today we can see wheat having stumbled more than 20%, which is a huge swing for any market. I am quite nervous as regards the trend of bean oil and soy bean, therefore plan your short position through taking options positions by buying puts and selling calls as they could still move up till 19th of November. As a matter of fact, you can expect a fall of more than 20% in two months. Corn prices will move down from end of Wednesday or Thursday, therefore trade accordingly.
There will be weakness in oil this week as well as in RB gas and heating oil. They will also be very volatile as we approach the last week of my important day, that is 19 November. There are 99.99 percent chances that oil will make a top at current levels, and we won’t see these prices again. However, if December trades against what I foresee, then there is no doubt that oil will reach $150 or $180. The following month is therefore very important for oil traders. At this stage I recommend that you take a short position on Monday and Tuesday and cover your short on Wednesday. On Thursday there will be some erratic movements and oil could touch a new high and then fall.
What a sharp correction that came in the Australian and Canadian dollars as well as the Pound! However, they are still way up and a lot is pending on the down side. This week the Pound, Australian and Canadian dollars will move down from Wednesday, therefore trade accordingly.
The Yen will trade sideways or weak for the first two days.
Astrologically, all currencies except the Yen are trading in a dangerous zone and taking a short at this level will provide well for you in the next three weeks, three months and three years.
You are getting the dollar index around $75. One cannot therefore ask for further discount as it seems to me as though you are getting it for free.
All major stocks especially my favorites: solar and battery have moved up more than we anticipated. I see a three year bull market in this sector, and this is therefore just but a beginning. One can partly book profit in stocks but your main position should remain intact. The European solar company GRSR is one to be watched closely. ESRG will announce its results and a very interesting development is taking place in a company like TSSP, which is trading at $0.0015.
BEFORE YOU PLACE YOUR ORDERS, YOU MUST KEEP TWO POINTS IN MIND:
*The commodity bull market is very near its end (19 November)
*The dollar’s turn around is right on the corner
Our weekly newsletter is most favorite of banks, financial instituations and traders in more than 50 countries. Click here to subscribe weekly newsletter:
Thanks & God Bless
Mahendra Sharma, 09 Nov