Monday, February 4, 2008

Market Forecast week of Feb 4-8

I'm happy to say that last week went more or less according to plan. I thought the markets would end higher and they did, by about 4-5%. The best weekly performance in several years. The Dow started the week at 12,200 and ended at 12,750. I had forecast at least 12,500 and possibly hitting 12,800. I was somewhat off in my day timing however, since I thought Wed and Thur would be the nice gains. As it was, the gains came Thurs and Fri. Monday was also a good up day. My call on the Euro was broadly correct since it was largely up against the US dollar although it did finish lower on Friday as forecast at 1.48. This was a little higher than I thought since I had thought it would settle back to 1.475. But at least I got the direction right.

This week will be more tentative all around. I do not expect the Dow to maintain this level (12,850) by Friday as the negative indicators outnumber the positive.. There will probably be an intraday retesting of last week's levels at 12,200 (1320 on the S&P) and a down mood will predominate. Monday the 4th afternoon looks negative, while Wednesday and Thursday (6th and 7th) look very volatile and largely negative as transiting Sun and Mercury oppose the natal Uranus and Ascendant in the NYSE chart. Look for greater than 1% declines, especially on Wednesday. Thursday afternoon will probably be less of a decline as there will be a substantial rally in the afternoon. There should be a rally Friday morning but it likely won't hold and the averages will probably finish in the red that day. We'll be lucky to finish the week above 12,500. I think a more realistic target will be near 12,200-12,400 and 1320-1340 on the S&P.

Tokyo by contrast looks neutral to bullish this week. Monday (4th) looks positive, and Wednesday (6th) looks like a solid up day, too, although the market is likely to finish with a loss on Friday(8th). Still, it should be in the green overall. Bombay looks slightly bullish as it starts with a strong Monday (4th). Wednesday afternoon looks negative though as Moon is aspected by Rahu. The negative sentiment will carry through Thursday (7th) with a down day. Friday will be an up day that should put the Sensex in positive territory for the week. We'll see how far above water it can remain.

The Euro looks mildly bearish this week but look for short term highs Tuesday morning local time as Moon conjoins the natal Venus. Thursday afternoon looks rough. It will probably fall back below 1.47 and finish the week near that level.
Gold looks slightly bearish this week. It might slip below $900 this week and may even finish below. But it does not look like another major downward leg. Watch for short term lows Wednesday a.m EST (6th) as the Moon falls under the spell of Ketu for a while. There ought to be a nice finish to the week with a big price rise Friday afternoon EST. It may even push back above $900 or perhaps even $910.