Today, at least for a while, both the Standard & Poor’s 500 and the NASDAQ index moved into all-time new high ground. Congratulations’  bulls! I guess it’s no secret, and since October of last year with my issuance of THE LONE BEAR LETTER, I have been looking for the market to go lower, not higher. However, the market has continually broken into higher ground, rather than lower ground, indicating that the major trend is still up. Once again there’s an old saying on Wall Street “don’t fight the Fed” and the “trend is your friend”. My philosophy and methodology as explained in my book: the VOLATILE MARKET HANDBOOK is “to let the market tell you what to do rather than you telling the market what to do.” When you are investing in the markets, you have to let go of your ego about being right! It’s not that I’m disappointed that the markets have collapsed, because in general that would not be good for any of us. The deflationary forces  I foresee coming ,could have disastrous effects on all of our lives. Therefore I am happy that the market is going up. However, I am reminded that when I wrote the LONE BULL LETTER, it took over nine months for the markets to start rallying and they never stopped  from 1982 basically two 2000. I still think markets and our economy, both in the United States and worldwide are in a precarious position. Maybe it will be a surprise event, maybe it will be just like the bank failures in 2008 or maybe the surprise will come from overseas. It is certainly not something I’m wishing for. Being involved in markets since the 1960s, leads me to believe that there’s “a problem” lurking just below the surface, somewhere.

  • 2) Right Intention

             Be Motivated by Goodness

When you are trading in the market what are you seeking?  Money?  Money is just a way to an end.  What are you really seeking? More money? HONK! Wrong answer.  What is really in your best interest?  The answer we propose is that your good intentions, combined with your money, should bring you joy, fulfillment and happiness. When you are trading, think of all the good things you are going to do with the money. This will increase the viscosity of the juices that flow through the “zone”.  Being a miser or being motivated by greed will sap your energy and creativity, because you are out of harmony with the universe.  You might ask what about all those wealthy bastards who are greedy and have gathered their fortunes through lies, cheating and deceit.  This kind of a question has been bothering virtuous people for a long time,  Back in 525, Boethius, who had previously led an idyllic life, was suddenly tossed into prison for religious differences with the Church and charged with treason.  In his classic book The Consolidation of Philosophy, Boethius talks to various muses in the style of non-fiction of the 1st century.  Lady Philosophy insists that the prisoners’ former wealth, fame, bodily pleasures and reliance on physical strength are all false goods, which failed to bring him happiness.  Responding to the prisoners lament that virtue suffers, while vice flourishes, she insists that virtue nourish the soul, while vice turns men into animals, who can never achieve fulfillment.  She explains that ‘Fortune’ has a two edged sword and that EVERYONE at some time faces both sides of the blade.  She says that good Fortune cannot be trusted and can suddenly abandon you through bad health, misfortune or betrayal.  I think of Berrnie Madoff and how he must have known every day that he was leading a false life and that someday his vices would come crashing down on him, his family and his trusted clients. His intension was to cheat and he has faced the consequences. Think instead of Andrew Carnegie, the great steel industrialist whose ambition was to give away in the second part of his life all of what he earned in the first half of his life.  His Foundation, good name and generosity continue to inspire each generation.  Think of the multi-billionaires like Bill Gates of Microsoft that  pledged to give away at least half of their fortunes. Think of Cindy Pritzker who has made a big difference in the city of Chicago by spearheading a new Library and Millennium Park.  If you are being captured by greed, think of these examples. You are a good person.  Have the intention to do good things. Go ahead; be in harmony with the universe. When you have good intentions, it somehow helps you to succeed.  If you can’t listen to your mind, listen to your body.  If you are feeling anxiety in your chest and head, you are doing something wrong. Stop trading.  Instead go see a sunset. Smell a flower.  Watch children play. Do something creative. Write a poem.  Compose a story.  Draw a picture. Get those divine creative juices flowing. Exercise!  I jog outside some 5 miles almost every day. Running along the lakefront and breathing in that fresh air reinvigorates me. Find out what gets your creative juices flowing.  Give joyfully to yourself.  Help someone else. Volunteer for an organization.  Pick up thrash instead of walking around it. Hug your loved ones.  Don’t get bogged down in greed.  Let your good intentions be your guide to internal happiness. The future is created in the now moment.  Start now!

 Current  Dow NASDAQ S&P 500
18,037 5,060 2,108
Short Term UP UP UP
Int. Term UP UP UP
Long Term UP UP UP
ForecastedTrendd  DJIA NASDAQ S&P 500
Short Term Down Down Down
Int. Term ? ? ?
Long Term Sideways? Sideways? Sideways?
Breakout Points DJIA NASDAQ S&P 500
Short Term Up (Resistance) 18,288 5,101 2,120
Short Term Down (Support) 17,147/17,0000 4605/4,5455     1,991/1,9733
Int. Term Up (Resistance) 18,974 See Fibonacci Projections above 5,002 See Fibonacci Projections above 2,486 See Fibonacci Projections above
Int. Term Down (Support)  15,855         /15,356 /14,688 4,166 3,986/3294 1,820 /1,560
Long Term Up (Resistance) 18,974 5,132 3,044
Long Term Down Fibonacci Support 50%12,000  62% 10,750       50%2,958  62% 2,555 50%1,390 62% 1,177
 10 yr Treasury 1.92 Gold 2.001 Oil 56.69