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.