Dow went to 10,977.68 on Friday from a high of 14,200..a stunning drop of 3222.32 Dow points or 22.6%...well into "bear market territory".......
Technicians/Hedge Funds HAVE positioned for more drop.......
So...How LOW will Dow GO????
My guess is between 10,000 to 10,500 on DOW ...so another 3.4% to 6.9% a total drop of 29.5% IS a possibility...
My educated GUESS tells me it SHOULD be more like 10,500 on Dow.......
So ...if we take a PROBABLE number of 10,500 which is about 600 Dow points away......it should take coming week to FINISH the "bear market" which started last October.....10 months ago.....
THEN......AFTER coming week !!!!!
We.....start work on CREATING a brand new "bull market"
Do you know that there is NO definition of a bull market.......
Most followers of this market are predicting a "strong rally from bear market LOWS"
So what is a strong rally?
I will say anything from 10% to 15% on Dow points......
So we are getting CLOSE to a rally of ABOUT 1500 Dow points.......
Now the question IS.......
Are you positioned to take advantage of this "strong rally which CAN spill over into 20% gain which MAY be about 2,000 Dow points".....as markets always OVERDO on both ends.......
It will be WISE to position with STRONG STOCKS where Sales & Earnings are GROWING faster than any other sector.....
We all have our favourites like AG,STEEL,COAL,OIL,GAS,SOLAR,TECH,GOLD,PHARMA......
What IS my thesis for this strong rally :
OIL heading to $120
GOLD heading to $800
US$ getting STRONG
That is enough to start a QUICK TURNAROUND in markets.....
My portfolio is:
AAPL............ Tech sector
SOL ...............Solar play
HOD.TO....... Short ETF on NYMEX CRUDE prices......
Hope you are READY to position for next trend which is looking UP !!!!
BLOG does NOT give buy or sell.
Saleem
10 comments:
Hi,
salim. It looks like market want to go higher.If you have a stomach and money time to gamble with LEH, FRE, FNM.
There is very good article about solar in FORTUNE. Pl.try to read. GS is involve big way in solar market.DEASERT LAND used to be 500 dollar per acer now it is 10000 or more.Lots of buyer.
solar sector should be very big.
tahnxs.
Hi Ds,
Bear market always test our wits about holding any stock.
Those who CAN navigate this bear tape will come out way-ahead.
Few bets are always better than many in bearish market.
Yes...Solar will rule now & in the end !!!
Saleem
I bought 25% more of all of my solar stocks on friday when DOW was down like 200points, and will add one more time, this is good time to average down or add more....
Hi Troy,
Adding to position @ these LOW levels is a very smart move.
We are almost coming to an end in this horrendous SLUMP !!!
Saleem
Hi Saleem,
I'm in Orlando FL. Went to the mall at 1:30 pm. About 150 people waiting in line outside of APPL store to see the new phone. It was roped off like security at the airport. Back and forth people in line to get in the store. Looks like a winner from here. Gas $3.95. Multiple retail & entertainment say business is very good. Traffic galore. No recession here.
Hi Standards,
Thanks for your update on AAPL store & lineup for 3G iphone.......
I think 3G iphone is already a runaway HIT......
Canadian dealers for 3G iphone is crowded with buyers since Friday....it is Canada's first exposure to 3G iphone from AAPL...NO iphone came to Canada last year!!!!
Economy will perk UP once Gas goes down to low $3......
Saleem
Long but interesting:
David Herro: Blood in the Streets, Time to Buy
Superstar money manager David Herro recommends that investors stand conventional wisdom on its head.
You should go short on commodities, long on the dollar, and long on financial, retail, media, and technology stocks, he says.
“The trade that’s in place, which is the momentum play, is long commodities, including oil, short financial stocks, and short the dollar,” the chief investment officer at Harris Investment Associates said in a recent interview with Yahoo Finance.
“Now I believe the pendulum has swung so far to an extreme, that the trade one should pursue is the opposite of that. You should short oil and other commodities and go long the quality financial and retail stocks,” says Herro, who also manages the $6.4 billion Oakmark International Fund.
Oakmark International, a large-cap value fund, is off 15.4 percent year to date. Its largest holdings include Credit Suisse, Daiwa Securities, GlaxoSmithKline and staffing company Adecco.
In addition, he recommends consumer, media, and technology stocks.
“You’ll probably get killed in the short term trying to do that,” Herro says. “But over the next year or two, that’s going to be the trade that wins.”
Among the technology companies Herro suggests buying are Dell, Intel and SAP. “These are all companies with strong business franchises,” he argues.
“They have been cyclically or structurally out of synch for a while. Maybe they had underperforming businesses for a while. Now they are all back on track.”
Herro says he can’t short oil in the funds he manages, but that he is personally shorting oil through the ownership of shares in UltraShort Oil & Gas ProShares, an exchange-traded fund (ETF).
“It’s not the perfect short for oil,” he says. “If I could find a better one, I would take it. But I think we’re in the seventh or eighth inning of the golden days for oil.”
Herro is bearish on agriculture and energy companies.
“Smart money should be taken off the table for agriculture and energy stocks,” he says.
“Move it. You’ve made a ton of money. Claim victory and move on to the burned-out areas.”
Herro says he recently saw a Morgan Stanley report recommending that strategy, including the purchase of AIG and JP Morgan Chase shares.
“That’s the first time I’ve heard a Wall Street firm talking about it,” he says.
“I would 100 percent agree. Given any true investment time horizon, that’s how any investor should think of it. Baron von Rothschild said buy when there’s blood on the street. There’s blood on the street. It’s time to buy.”
Herro says the credit crisis is probably two-thirds to three-quarters over. “We see signs. Mistakes were admitted, capital has been raised, markets have stabilized,” he says.
“The problem that caused this whole thing, the housing bubble, we’re starting to see signs that buying is picking up in housing. Slowly some of this excess supply has been sopped off.”
On another subject, Herro says claims that Merrill Lynch is in as much trouble as Lehman Brothers are ridiculous. “The two are completely different businesses,” he says.
“Maybe they both have a similar trading operation. But Merrill Lynch has a huge wealth management business, a big stake in Bloomberg, a big stake in Blackrock. Merrill in essence is a store of value that is comprised of numerous other businesses.”
Hi Troy,
Thanks for posting "Blood on the street"
My conclusion based on today's BLOG posting is "there is $ on the street"....NO takers NOW !!!
Saleem
SALEEM
AAPL up huge in pre-market $$$$$$$
Money money money YES!!!
I still own HAL, MON CHL DSX GS HAL SOL V
Hoping for a recovery in VISA. Mastercard has been on a tare going higher even last week in hte terrible sell off.
The tankers may take off now, and DSX is paying 10% dividend to wait.
Good luck to all, lets hope for a great Green close--as we are in need of 4 nice solid green closes to get the market going up again, IMHO....
Hi Ds,
Thanks for your research about solar & info for the BLOG.
Financials are the ultimate contrary play.....
I am sure you will do well today in LEH,FRE,FNM....but BE quick to lock the GAINS !!!!
Solar is ROCKETING UP in pre-market $$$
Saleem
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