Sunday, October 31, 2010

Stock Market -- Position Overview

Our previous newsletter, dated July 31st, stated that the weaker US could produce a counter trend bear market advance within the stock market, with the projected DOW trading range for the month between 9,700 and 10,800. The actual result saw the DOW in deed rally, but with a slightly narrower trading range than forecasted, between 9,614 and 10,585.

The US dollar, at least for the near-term, was projected to remain under price-pressure, with a euro fx equivalent trading range for the month between $1.24 and $1.34. This proved to be fairly accurate, but with a narrower trading range than anticipated, between euro fx equivalent $1.2350 and $1.3063.

The US treasury 10-year Note was anticipated to hover around the 3% rate, and the long bond around the 4% level, since the Fed had no logical reason to start tightening, as long as credit growth remains flaccid, hiring stays weak, with inflation non-existent. We forecasted, at least for the near-term, that the US 10-year Note could come under slight price-pressure, causing yields to inversely rise, with a projected base-yield of 2.90% or higher. This proved to be accurate, as the actual US 10-year Note yield range for the month was between 2.88% and 3.12%.

FOOTNOTE: The August 2010 and September 2010 newsletters were not released, while the October 2010 newsletter postponed, all to the financial benefit of investors utilizing our Private Account Wealth Management Services.

Saturday, July 31, 2010

Stock Market -- Position Overview

Our previous newsletter, dated May 26th, stated that the DOW appears to have entered a period of broad consolidation from an overbought situation, which could produce a larger trading range during the course of the month, between 9,800 and 11,200. The actual result saw an expanding trading range for all of the major indices, with the DOW moving between 9,774 and 11,177.

The US treasuries were anticipated to be price-supported, inversely causing yields to decline, with a projected peak-yield for the US 10-year Note at 3.60% or lower. The actual result did see the US treasuries rallied in price, as a global safe-heaven, when the stock market came under pressure, producing a US 10-year Note yield range for the month between 3.09% and 3.71%.

The US dollar was forecasted to rise in value, with a projected euro fx equivalent trading range for the month between $1.21 and $1.32. This proved to be the case, as global concerns caused investors to flock to the US dollar, producing an actual euro fx equivalent trading range between $1.2127 and $1.3202.

Wednesday, May 26, 2010

Stock Market -- Position Overview

Our previous newsletter, dated March 31st, stated that the DOW continues within its period of elevated consolidation, at least for the near-term, and projected a trading range for the month between 10,400 and 11,100. We further stated that this type of gradual ascent is commonplace within bear markets or counter trend rallies, as various markets adjust to a point of neutrality or equilibrium, prior to resuming the primary bear market trend lower. The actual result produced a slightly narrower trading range than anticipated, between 10,326 and 10,955.

The US dollar was projected to remain within a broad trading range, between euro fx equivalent of $1.34 and $1.38. The actual result was a wider trading range than projected, between euro fx equivalent of $1.3237 and $1.3753.

The US treasuries were anticipated to remain under price-pressure, at least for the near-term, with the US 10-year Note having a base-yield for the month of 3.60% or higher. The actual result saw the US treasuries decline further in price, causing yields to inversely rise, producing a US 10-year Note yield range for the month between 3.59% and 3.93%.

Wednesday, March 31, 2010

Stock Market -- Position Overview

Our previous newsletter, dated February 27th, stated that the stock market remains within an elevated period of consolidation, as the various stimulus programs try to rejuvenate the US economy, at least for the near-term. We further projected that the DOW would remain price-supported, due to these various stimulus packages, and anticipated a trading range for the month between 9,800 and 10,600. The actual result was a slightly narrower trading range, during the course of the month, between 9,835 and 10,438.

We also stated that we could see interest rates go higher, as various states and countries find themselves in budget deficits, and have to pay more to borrow money, because of the slippage in their ratings. This could lead to higher interest rates all around, as people value risk more carefully, and cause US treasuries to decline in price, inversely producing higher yields. We, therefore, anticipated that the US 10-year Note could have a base-yield of 3.53% or higher, as prices decline and yields inversely rise, during the course of the month. The actual result saw the US treasuries decline in price, producing a US 10-year Note yield-range for the month between 3.54% and 3.83%.

The US dollar was projected to decline in value, at least for the near-term, during the course of the month, with a anticipated euro fx equivalent trading range between $1.34 and $1.40. This forecast proved to be fairly accurate, as the US dollar remained under near-term pressure, producing a euro fx equivalent trading range for the month between $1.3438 and $1.3947.

Saturday, February 27, 2010

Stock Market -- Position Overview

Our recent newsletter, dated January 22nd, stated that we remain bearish, as Main Street readjusts it consumption/saving patterns to the new normal. The stock market sugar high remains in place for the time being, but several technical indicators suggest prices are within the throes of a topping process. We anticipated that the DOW could continue within this "elevated topping process period of consolidation" during the course of the month, with a projected trading range between 10,150 and 10,950. The actual result saw the DOW trade within a narrower range than projected, between 10,043 and 10,729.

The US dollar was anticipated to remain within a broad trading range, between euro fx equivalent of $1.40 and $1.46, during the course of the month, as investors continue to decide if this the their global currency-of-choice for the short and long-term future. The actual result produced a slightly larger trading range than projected, between euro fx equivalent $1.3865 and $1.4561.

The US treasuries, at least for the near-term, was forecasted to remain within a supported price trading range, during the course of the month, with a peak-yield for the US 10-year Note of 3.85% or lower. We further stated that China and Japan will continue to feed the US debt addiction, eventually equaling the US Gross Domestic Product, and producing undesirable long-term consequences. The actual result saw the US treasuries remain within a supported price trading range, with the US 10-year Note having a yield-range for the month between 3.58% and 3.86%.

Friday, January 22, 2010

Stock Market -- Position Overview

Our previous newsletter, dated December 21st, stated that earnings have produced the continued "elevated period of consolidation" for the entire stock market. We further stated that the DOW could remain elevated, at least for the near-term, with an projected trading range for the month between 10,200 and 11,000. The actual result saw the DOW continue the gradual ascent, with narrower trading range for the month than anticipated, between 10,235 and 10,580.

We stated that the counter-trend elevated ascent within the stock market could cause the US treasuries to decline in price, inversely driving yields higher, as investors are lured to the stock market. The US 10-year Note was projected to decline in price during the course of the month, and have a base-yield of 3.20% or higher. The US treasuries actual result did see them decline during the period, with the US 10-year Note having a yield-range for the month between 3.22% and 3.92%.

The US dollar was anticipated to resume its primary trend lower, and we projected a euro fx equivalent trading range for the month between $1.42 and $1.52. The actual result did see the US dollar continue its decline in value, with a euro fx equivalent trading range for the month between $1.4235 and $1.5135.