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Why I am predicting worst crash in commodities and markets.. read last week newsletter..


Weekly newsletter, Dated – 6, Jan 2008


Dear Members,

2008 started and portrayed the picture of the first week trading was completely different and which is making many people nervous on stocks and giving many people hopes that there will not be an end of bull market in commodities. My outlook after the 4th of January is completely different and I believe that what I see for the month of January will come accurately as I have 100% confidence in what the planets are telling me. This month the predictions will prove that why each trader should at least have a glance at what the planets are saying. Planets can turn any chart from bullish to bearish and any bearish trend to bull market. This is a hidden power which creates a wave and from one mind journey starts and that journey involves millions of people.


In 2001 journey started for the metals and oil and now we can see that millions of people are involved it. Last year, the journey started for alternative energy stocks especially solar and look at it now, the whole scenario has changed in solar or alternative energy sector. I am predicting here a severe crash in commodity market starting. I warn traders who are involved in metals, energy, grains AND in emerging market. This is the first time when I am saying that even the long term traders should sell 99% of their position in commodity market. Very few times in my astrological advising career I have warned about something like this, yes I did warn in early 2000 the crash in technology and in 2001 I warned crash of US dollar.


Those people who still like the commodity and do not want to short the markets then at least get out from the position and hold cash as great buying opportunity will come in February but before that, a wave of tsunami will clean many chapters for many institutions as I see many buyers will get stuck so badly that they will not be able to get out. This includes few banks, financial institutions and many hedge funds.


Let me start this week’s newsletter: Predictions from 7 to 11 January     


Monday will be the best day to sell both these metals as any time from Monday or Tuesday the sharp correction in metals will start. On Tuesday the market will remain very volatile and we will see sharp rising and then finally fall in metals. Wednesday, Thursday and Friday the metals and metal stocks will remain weak so no buying even at the lower price is recommended.


The gold and silver can fall around 3-5% so trade carefully. Metal stocks indexes, HUI and XAU will head towards a major correction and they can keep falling for the whole month of January.



All these metals will remain weak but especially copper and platinum will have a major correction. The correction in platinum and copper can be more than 30% in the month of January so it is a great time to buy puts or sell calls. Zinc, nickel and palladium will also remain weak but after a few weeks we will start buying these metals.



This week coffee and cotton will trade in a very narrow range and any weakness should be taken as a buying opportunity. We shall continuously keep buying small positions for the next few weeks and those who do not want to take a risk in the future market can buy calls of month of May as before the month of May 2008 cotton and coffee surely will hit a new high of the last ten years. During this week they both will trade sideways.



During this week all these soft commodities will remain weak including my favorite sugar. We have done quite will in sugar trading. This week lumber and orange juice will remain weak so we hold our prediction of weak market for both these soft commodities. On the last hour of Wednesday and early Thursday will be the best time to buy sugar as prices of sugar will move up.



There is no doubt of even one percent in my mind of bull market of USA stocks.  

Banking and financial stocks will provide a solid return during this week as they are very near to turn around. Commodity stocks will move down sharply but technology stocks will remain sideways. One point you will notice in tech stocks is that Mid Cap stocks will perform better then the Front Liner. This week it is time to buy City Bank, JP Morgan, Bank of America, Goldman Sachs and many beaten housing stocks.


International stock market will trade sideways so once again I recommend strongly selling international stocks so book profit in Asian and European markets. The reason behind this recommendation is that billions of dollars will move back in the US dollar and US dollar papers. This means that big people will sell the assets in the countries where they have gained a great amount of money in the last two years in terms of currency as well as in terms of investment. In international market just remain sector specific and at this stage I just recommend power and alternative energy are.


Australian and Canadian commodity stocks will perform very negative so one can sell these stocks. I am not recommending any new buying in both these exchanges except nuclear and alternative energy stocks.



When too many people get involved with a very small market then huge volatility always dominates that market and at the same times those who are behind that matter. Many of my members have taken a short position in grains in the last ten days in options trading and I strongly recommend holding short position in grains. The grains will have a sharp correction from Monday till the mid trading session of Thursday and from Thursday last hours they may rebound technically. Friday they may open higher but then they will fall sharply and that will confirm the end of the bull market of the last 18 months. Short term they are entering in a very weak trend and within a few months they can fall around 35% to 50%. Yes, there is a great amount of money to be made so have patience, do not go high leverage.



December 2003, when I finished the chapter on oil in my book world and financial prophecies (pg 100) and in the first paragraph of the oil chapter it says “I expect oil prices to reach up to $100 per barrel” at that time oil was trading around $30 a barrel. Is it not a coincidence that the oil price of $100 a barrel was mentioned on page number 100? Now astrology has given a very weak sign for oil and the price of oil is around $100 so yes, it is clear that short term oil prices will fall.


Last week natural gas remained positive as predicted. During this week, the best trade will be to sell oil, heating oil, RB gas and buy the natural gas against your selling, and this hedging trade will provide you with a safe return. I expect oil prices to fall any time from Monday or definitely from the Tuesday in the volatility but there will be a sharp correction from Wednesday and oil prices can come down to $92.80.



Last week, dollar remained a bit weak as we were expecting and I am sure that many must have bought it. Those who have not bought it should not wait any longer and just grab the dollar index and sell Euro, British Pound, Canadian and Australian Dollar. Those who do not want to take much risk in future market can buy puts and sell calls of March 2008 as well as December 2008.  


$75.80 is a great level to buy dollar index and my target for this week is that dollar index will move to $77.30. Within the month of January I am expecting dollar index to reach $80. I know it is tough to believe because many traders are calling the death for dollar or saying that the dollar story is over. Keep open minded, don’t get negative influence as you want to trade in the market and make money because emotion and affection will lead you onto the wrong path.


Avoid trading Japanese Yen and Swiss Franc as both these currencies will trade sideways but they will gain against other currencies of the world except US Dollar. I see US Dollar starting to rise from Monday and Tuesday and that will prove that dollar is entering into a big bull market.



In many countries of Asia and Middle East, real estate market will come down and I do not recommend any speculative buy in real estate market in these regions during 2008. The worst performer will be the Middle East countries including U.A.E. Overall 2008 is not going to be that great for real estate market. So in any country, except if you want to buy your house for living, no speculative buying is recommended. In 2008 U.A.E region will be the worst performer and bear trend of real estate market will continue for the next 7 years so be careful.



The month of January indicates very negative time for commodity market as well as for emerging markets so it is my duty to warn my members. Sell Australia, India, Hong Kong, China, Korea, Taiwan and European market. It is not a coincidence that the commodity prices have reached at the top but at the same time the most bearish signal is given by the planets so fall is there without any doubt.


Thanks & God Bless,

Mahendra Sharma, 6 Jan 2008