2010 Stock Market ????

2009 created "above average gains"......

2009 S&P 500 started @903.25 Dec 31st, 2008

2009 lowest point was 666.79 on March 6th, 2009

2009 highest point was 1130.38 Dec 28th,2009

2009 highest close 1127.78 28th Dec,2009

2009 S&P 500 closed @ 1115.10 Dec 31st,2009

YTD gain of 211.85 points or 23.45%...............

NOW....the question IS ...what to expect in 2010 ????

2010 is expected to show economic revival by Q3 with a strong Q4

2010 Q1 & Q2 MAY be weaker than current euphoria about economy & stock market.....

Based on the above economic scenario..I am expecting first half to be difficult in economy & stock market........

Based on HOW i interpret ..I am expecting stock market to be @ lows of the year in first half......

SO...lets do some mind game for stock market prediction...which is almost IMPOSSIBLE to do..but lets do it anyway......

I see S&P 500 to hit 1200 area in Jan.......

I see S&P 500 to hit 1080 area in Feb.......

I see S&P 500 to hit 1120 area in March...

SO...based on the above by end of March we are going nowhere fast......

By June S&P 500 will retest 1080 support and MAY breach it LOWER to 1050 area.....

BUT...by December 2010 S&P 500 to cross 1300.......

SO..IF my scenario hold...S&P 500 will show YTD gain of 184.90 points or 16.58%......

BUT there is a downside RISK of <65> or <5.82%> till end of June......which MAY knock your investing/trading confidence?

SO...be REALISTIC in facing markets UPS & DOWNS...these ARE normal occurrence and stock market in 2010 WILL be a normal market.......

Booking profits MAY not be a bad idea until June .. it will be a traders market till June......from July to December it will be an investors dream....so "overexposure is warranted"

July to December Gains SHOULD be a very healthy 250 S&P points or 23.8%......

Bottom line is ..looks like "reduced exposure" till June..... MAY not be such a bad idea......

Here is my $ /sector allocation as of 31st Dec :

TSL 30.48% Solar fully integrated
POT 18.69% AG/Potash producer
AMZN 13.30% Tech/online retailer
SOLF 12.28% Solar fully integrated
SLW 8.48% Silver Reseller
AUY 6.42% Gold Mining
IAG 5.74% Gold Mining
TC 4.61% Molybdenum Mining

I remain "overweight" in Solar & mining sector BUT still diversified in many sectors....

I will be selling into strength & pulling money out from market @ the same time...BUT will maintain exposure in market all the time.....this is for my comfort level based on how i see this market behaving till June......

You all need to FIGURE out how YOU see this market trending & find your OWN comfort level....I am WRONG like everyone else in predicting market movement which REMAINS impossible to PREDICT......BUT @ least I have MY game plan....which I PLAN to EXECUTE....

I will closely MONITOR tape as usual which will be the FINAL verdict for me......

BLOG does NOT give buy or sell.

Saleem