FINANCIAL CYCLES WEEKLY UPDATE #0349 – December 7-13, 2003 with TIM BOST

COMMENT: For a brief amount of time last week, it looked like the stock market had something to celebrate. The NASDAQ moved above the 2000 mark in intraday trading, and the Dow Industrials squeaked above 9900. The bulls were about to be vindicated once again, but then reality set in, in the form of the latest employment reports.
Unemployment in November dropped to 5.9 percent from October’s 6.0 percent. About 57,000 new jobs were created. The only problem was that analysts and economists had been expecting roughly three times that number of new jobs, so this number was genuinely disappointing, if not downright alarming. Of course it didn’t help matters much when President Bush started crowing about how great the November unemployment figures were. Was he openly trying to mislead the American public, or was he simply unable to grasp the gravity of the situation?
Either way, it didn’t play well on Wall Street. The indexes promptly retreated from their awe-inspiring forays into the realm of higher mathematics. The Dow Industrials finished the week with a negligible gain, while the NASDAQ gave up some more significant ground. The dollar fell to a record low against the euro, and the news came out that consumer debt had increased by $941 million during October. Earnings warnings from Intel, JetBlue and Southwest Airlines sent airlines and chip stocks lower, but money flowed into gas and oil stocks, despite lower prices for both crude oil and natural gas.
It was clearly a bump in the road for the current market rally, but things could have been much worse. The major snow storm that hit the northeastern U.S. kept lots of traders home, so the pull-back in stock prices came on lighter than normal volume.


THE WEEK AHEAD

Except for a few preannouncements, we’re looking at another low-key week for earnings. We will get reports from a few companies, however, including Costco (COST), Autozone (AZO), Kroger (KR), and Adobe Systems (ADBE). On the economic front, we are looking for numbers on Wholesale Inventories, Business Inventories, Retail Sales, Export Prices, Import Prices, and the Trade Balance. We will also get the November Producer Price Index, the Fannie Mae annual fall/winter report on the outlook for the mortgage market, and the University of Michigan Consumer Sentiment report for December.
The Federal Reserve’s Open Market Committee meets on Tuesday with Mars semisquare Neptune, so any actions it takes are likely to provoke more confusion than confidence. The consensus is that the Fed will leave short-term interest rates unchanged, but as usual the innuendo and implications will be given far more weight by the pundits than they actually deserve. Look for the sages and spin doctors to have their say Tuesday evening, but with a void-of-course Moon at work then it will be wise not to take their pronouncements too seriously.
The astrological picture this week moves us from a fairly intense Full Moon into a Jupiter/Pluto square. This is an environment in which prices are more likely to trend upward rather than downward, but we will nevertheless remain cautious, especially since the market has recently been defying expectations with some regularity. Another factor at work this week is a Venus/Chiron conjunction, which typically brings the market down for a day or two before sending it sharply upward. The Sun/Pluto conjunction this week is also bullish—it usually brings a slightly delayed reaction, but its bias is definitely to the upside.
Have a great week!


GLOBAL EQUITIES MARKETS LAST WEEK

Stocks were generally lower in markets around the world in a week of mixed trading, with the exception of Tokyo and Sydney, where equities added some strength. The NASDAQ and the Hang Seng Index showed the strongest weekly reversals to the downside.

Dow Jones Industrial Average – up 0.82%
Dow Jones Transportation Average – down 0.36%
Dow Jones Utilities Average – up 1.36%
S& P 500 – up 0.31%
NASDAQ Composite Index – down 1.14%
Russell 2000 – down 1.37%
London FTSE-100 – up 0.82%
Paris CAC-40 – up 0.94%
Frankfurt DAX – up 2.56%
Sydney All Ordinaries – up 1.14%
Tokyo Nikkei – up 2.70%
Hong Kong Hang Seng Index – down 0.02%
Singapore Straits Times Index – up 1.11%


FINANCIAL CYCLES MODEL PORTFOLIO


POSITIONS CLOSED DURING THE PREVIOUS WEEK: RANGY, TECH, MRBA, STRA.

We closed four portfolio positions during the previous week, with one winner and three losers producing a net loss of $245.00.

On December 1 we bought to cover 500 shares of Randgold & Exploration Company Ltd., ADS (RANGY) at 16.75, taking a loss of $125.00 (a 1.52% loss in 2 trading days).

On December 1 we bought to cover 300 shares of Techne Corporation Inc. (TECH) at 36.50, taking a loss of $75.00 (a 0.69% loss in 2 trading days).

On December 3 we bought to cover 1,000 shares of Marimba, Inc. (MRBA) at 5.70, taking a loss of $100.00 (a 1.79% loss in 11 trading days).

On December 4 we sold 100 shares of Strayer Education, Inc. (STRA) at 103.80, taking a profit of $55.00 (a 0.53% gain in 12 trading days).

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POSITIONS ADDED TO THE PORTFOLIO DURING THE PREVIOUS WEEK: CELG, PKTR, SGMA, CMTL.

We sold short 200 shares of Celegene Corporation (CELG) at 47.50 on 12/01/03, setting our initial buy stop at 49.00

We sold short 500 shares of Packeteer Inc. (PKTR) at 21.50 on 12/01/03, setting our initial buy stop at 23.00.

We sold short 300 shares of Sigmatron International Inc. (SGMA) at 29.85 on 12/01/03, setting our initial buy stop at 35.00.

We bought 300 shares of Comtech Telecommunications Corporation (CMTL) at 32.75 on 12/03/03, setting our initial stop at 30.18.

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YEAR-IN-REVIEW MODEL PORTFOLIO ACTIVITY

Since the beginning of the year we have had a total of 160 completed trades, with 92 winners and 68 losers bringing us a total net profit of $51,556.00. The largest profit for a single trade has been $9,240.00; the largest single-trade loss has been $900.00; the average profit per trade has been $322.23. The mean duration of our trades has been 10.3 trading days.

During 2002 we had a total of 195 completed trades, with 119 winners, 74 losers, and 2 break-even trades bringing us a total net profit of $50,956.00. The largest profit for a single trade was $5,100.00; the largest single-trade loss was $1,055.00; the average profit per trade was $261.31. The mean duration of our trades was 12.7 trading days.

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CURRENT POSITIONS IN THE MODEL PORTFOLIO

Amkor Technology, Inc. (AMKR) – bought 500 shares at 19.00 on 11/26/03; currently 19.30. Raise stop to 18.76.

Aspect Communications (ASPT) – sold short 500 shares at 14.25 on 11/26/03; currently 13.77. Buy stop set at 15.00.

Celegene Corporation (CELG) – sold short 200 shares at 47.50 on 12/01/03; currently 45.92. Lower buy stop to 48.25.

Comtech Telecommunications Corporation (CMTL) – bought 300 shares at 32.75 on 12/03/03; currently 32.56. Raise stop to 30.99.

Kos Pharmaceuticals Inc. (KOSP) – bought 300 shares at 42.25 on 11/24/03; currently 43.80. Raise stop to 43.00.

Packeteer Inc. (PKTR) – sold short 500 shares at 21.50 on 12/01/03; currently 19.04. Lower buy stop to 21.75.

Sigmatron International Inc. (SGMA) – sold short 300 shares at 29.85 on 12/01/03; currently 30.75. Lower buy stop to 33.75.

USANA Health Science Inc. (USNA) – bought 300 shares at 33.25 on 11/17/03; currently 34.63. Raise stop to 33.50.

Witness Systems, Inc. (WITS) – bought 1,000 shares at 8.00 on 11/17/03; currently 9.29. Raise stop to 9.06.

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ECLIPSE PORTFOLIO

Our Eclipse Portfolio is an experiment in working with longer-term positions in the stock market, as opposed to the more active trading positions in the Financial Cycles Model Portfolio, which we are currently holding for an average of 10.3 trading days. Although a long-term, “buy and hold” strategy leaves us very concerned about capital preservation and portfolio safety given the current market conditions, we are always on the lookout for profitable investment strategies that require less time and energy than an active approach to trading.
The stocks in the Eclipse Portfolio all have First-Trade horoscopes featuring a Sun that was directly impacted by the November 23, 2003 solar eclipse. The portfolio includes only long positions, with stop-loss points set liberally to allow for broader price fluctuations while providing a safety net to protect the capital in the portfolio. When positions in the Eclipse Portfolio become sufficiently profitable we will raise our stops to lock in profits accordingly, but our intention is to let our winners run as long as possible.
All the stocks in the Eclipse Portfolio were purchased on November 24, 2003, with a total initial investment of $21,345.00. The current equity in the portfolio is $21,511.00, for a gain of 0.78% since the portfolio’s inception.

J. B. Hunt Transportation Services, Inc. (JBHT) – bought 200 shares at 25.25 on 11/24/03; currently 26.55. Raise stop to 25.75.

Medtronic, Inc. (MDT) – bought 100 shares at 44.25 on 11/24/03; currently 46.55. Raise stop to 45.00.

Network Appliance, Inc. (NTAP) – bought 200 shares at 22.25 on 11/24/03; currently 21.66. Stop set at 19.65.

Silicon Storage Technology, Inc. (SSTI) – bought 300 shares at 13.00 on 11/24/03; currently 12.20. Stop set at 11.87.

Teledyne Technologies, Inc. (TDY) – bought 200 shares at 17.60 on 11/24/03; currently 17.77. Stop set at 15.70.

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STRONGEST MARKET SECTORS LAST WEEK

Oil & Gas Equipment & Services; Oil & Gas Drilling & Exploration; Industrial Metals & Minerals; Shipping; Independent Oil & Gas.

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WEAKEST MARKET SECTORS LAST WEEK

Education & Training Services; Regional Airlines; Major Airlines; Toy & Hobby Stores; Data Storage Devices.

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KEY ASTROLOGICAL EVENTS THIS WEEK

December 7
Sun sextile Neptune in right ascension 01:40 EST
Mercury sesquiquadrate True Lunar Node 02:04 EST
Heliocentric Earth square Heliocentric Mercury 02:29 EST
Heliocentric Mars in 24th harmonic to Heliocentric Admetos 04:38 EST
Void-of-Course Moon 04:54 – 6:26 EST
Heliocentric Venus quincunx Heliocentric Vulcanus 06:11 EST
Lunar Apogee 07:06 EST
Heliocentric Venus trine Heliocentric Hades 07:58 EST
Heliocentric Venus sesquiquadrate Heliocentric Zeus 08:31 EST
Heliocentric Venus trine Heliocentric Apollon 14:15 EST
Heliocentric Mars trine Heliocentric Jupiter 14:30 EST
Heliocentric Mercury in 24th harmonic to Heliocentric Uranus 14:46 EST
Mercury sextile Poseidon 19:50 EST
Heliocentric Mercury sextile Heliocentric Chiron 23:50 EST
Mercury semisextile Cupido in right ascension 23:52 EST

December 8
Heliocentric Earth in 24th harmonic to Heliocentric Kronos 01:31 EST
Heliocentric Mars semisquare Heliocentric Hades 03:52 EST
Heliocentric Venus sesquiquadrate Heliocentric Saturn 03:56 EST
Mercury sesquiquadrate Admetos 05:07 EST
Heliocentric Mars quincunx Heliocentric Zeus 05:21 EST
Heliocentric Mercury square Heliocentric Pluto 05:49 EST
Venus semisquare Uranus 08:24 EST
Heliocentric Mercury sesquiquadrate Heliocentric Poseidon 11:53 EST
Mercury square Zeus in right ascension 12:43 EST
Full Moon 15:37 EST
Sun semisextile Chiron 16:31 EST
Heliocentric Mercury sextile Heliocentric Admetos 17:58 EST
Heliocentric Mercury trine Heliocentric Vulcanus 20:18 EST
Heliocentric Mercury square Heliocentric Hades 20:56 EST
Jupiter trine Admetos in right ascension 23:04 EST
Heliocentric Mercury quincunx Heliocentric Apollon 23:07 EST
Heliocentric Mercury semisquare Heliocentric Mars 23:24 EST

December 9
Venus semisquare Uranus in right ascension 02:04 EST
Venus conjunct Chiron in right ascension 07:50 EST
Mars semisquare Neptune 08:59 EST
Heliocentric Mercury semisextile Heliocentric Venus 16:25 EST
Void-of-Course Moon 17:48 – 19:11 EST
Heliocentric Mars quincunx Heliocentric Cupido 21:26 EST
Heliocentric Mercury semisquare Heliocentric Neptune 22:52 EST
Mercury square Zeus 23:27 EST
Venus trine True Lunar Node in right ascension 23:50 EST

December 10
Venus conjunct Chiron 03:28 EST
Sun square Jupiter 05:57 EST
Mercury semisextile Cupido 06:46 EST
Heliocentric Jupiter semisquare Heliocentric Vulcanus 06:59 EST
Sun semisextile Chiron in right ascension 10:17 EST
Heliocentric Mercury enters Aries 11:25 EST
Heliocentric Venus in 24th harmonic to Heliocentric Neptune 11:34 EST
Heliocentric Mars sextile Heliocentric Saturn 14:13 EST
Heliocentric Mercury square Heliocentric Kronos 15:07 EST
Heliocentric Mercury semisextile Heliocentric Uranus 21:22 EST
Heliocentric Earth quincunx Heliocentric Chiron 23:36 EST
Venus trine Admetos in right ascension 23:41 EST

December 11
Sun quincunx True Lunar Node in right ascension 01:55 EST
Venus trine Jupiter in right ascension 02:51 EST
Venus semisextile Pluto in right ascension 04:20 EST
Venus trine Jupiter 09:22 EST
Heliocentric Mercury quincunx Heliocentric Poseidon 16:21 EST
Heliocentric Mercury semisquare Heliocentric Admetos 21:54 EST

December 12
Sun conjunct Pluto 00:28 EST
Heliocentric Earth opposition Heliocentric Pluto 00:36 EST
Heliocentric Mercury quincunx Heliocentric Jupiter 00:39 EST
Heliocentric Venus enters Pisces 00:41 EST
Heliocentric Mercury opposition Heliocentric Zeus 00:47 EST
Void-of-Course Moon 01:53 – 6:40 EST
Sun semisquare Poseidon in right ascension 03:30 EST
Heliocentric Mercury trine Heliocentric Cupido 05:26 EST
Heliocentric Mercury square Heliocentric Saturn 07:38 EST
Sun quincunx Admetos in right ascension 08:37 EST
Sun quincunx True Lunar Node 08:45 EST
Heliocentric Jupiter semisextile Heliocentric Zeus 08:56 EST
Heliocentric Venus trine Heliocentric Kronos 11:59 EST
Heliocentric Mercury semisextile Heliocentric Mars 12:40 EST
Sun square Jupiter in right ascension 15:00 EST
Sun conjunct Pluto in right ascension 15:52 EST
Venus semisextile Pluto 19:12 EST
Venus square Apollon in right ascension 23:07 EST

December 13
Heliocentric Mercury sextile Heliocentric Neptune 00:15 EST
Venus trine True Lunar Node 00:23 EST
Venus quincunx Hades in right ascension 01:29 EST
Heliocentric Earth sesquiquadrate Heliocentric Poseidon 02:30 EST
Mercury opposition Saturn in right ascension 02:54 EST
Mercury semisextile Neptune 05:49 EST
Venus semisquare Cupido in right ascension 06:32 EST
Heliocentric Venus conjunct Heliocentric Uranus 07:26 EST
Mars semisquare Neptune in right ascension 08:12 EST
Mercury opposition Saturn 09:24 EST
Sun semisquare Poseidon 13:40 EST
Sun quincunx Admetos 20:51 EST
Heliocentric Mercury semisquare Heliocentric Uranus 20:52 EST

December 14
Venus contraparallel Kronos 00:12 EST
Venus contraparallel Kronos in right ascension 02:17 EST
Heliocentric Mercury semisquare Heliocentric Venus 02:34 EST
Jupiter square Pluto in right ascension 03:48 EST
Heliocentric Mercury square Heliocentric Chiron 04:45 EST
Heliocentric Earth semisextile Heliocentric Admetos 05:48 EST
Venus trine Admetos 07:01 EST
Saturn quincunx Neptune 07:47 EST
Heliocentric Mercury trine Heliocentric Pluto 09:18 EST
Heliocentric Venus semisquare Heliocentric Chiron 09:54 EST
Heliocentric Mercury parallel Heliocentric Venus 11:38 EST
Void-of-Course Moon 15:05 – 16:07 EST
Heliocentric Earth semisextile Heliocentric Vulcanus 16:12 EST
Sun sextile Apollon in right ascension 18:58 EST
Heliocentric Earth conjunct Heliocentric Hades 19:12 EST
Heliocentric Mercury semisextile Heliocentric Admetos 19:15 EST
Sun opposition Hades 19:20 EST
Sun opposition Hades in right ascension 20:45 EST
Heliocentric Mercury square Heliocentric Vulcanus 21:11 EST
Heliocentric Mercury sextile Heliocentric Hades 21:45 EST
Heliocentric Earth sextile Heliocentric Mercury 22:20 EST
Heliocentric Mercury sesquiquadrate Heliocentric Jupiter 22:44 EST
Heliocentric Mercury opposition Heliocentric Apollon 23:33 EST

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STOCKS TO WATCH: RFMI, ROAD, XICO.

RF Monolithics Inc. (RFMI)
First Trade Date: 07/28/1994; 09:30 a.m.
Trading Strategy: Jupiter is currently crossing the RFMI First-Trade Ascendant, and we expect the price of this stock to move up this week accordingly. To strengthen matters even more, transiting Jupiter will immediately conjoin First-Trade Venus. In addition, the Sun is currently crossing the First-Trade IC, a dynamic that has brought the price of this stock up in about 67% of its past occurrences. All this provides a slightly bullish bias for this stock, and our plan is to follow through in that direction. Unless we get a close below the mirrored geocentric 7.4 Hades line at 8.49 early this week, we will add a long position to the Model Portfolio, setting our initial stop at 8.25.

Roadway Corporation (ROAD)
First Trade Date: 01/02/1996; 09:30 a.m.
Trading Strategy: The transneptunian planets Hades and Vulcanus figure prominently in the price movement for this stock. We’ve found it helpful to look at heliocentric 24 lines for both of them, plus a geocentric 74.067 line for Hades and a geocentric 108.25 line for Vulcanus. Transiting Saturn is currently in opposition to the ROAD First-Trade Sun, and a heliocentric 24 Saturn line has recently provided some resistance. Saturn will move out of orb from that aspect soon, however (it will repeat late next May), leaving the door open for another price advance. Our plan is to add a long position in ROAD to the Model Portfolio this week, setting our initial stop at 50.71.

Xicor Inc. (XICO)
First Trade Date: 10/24/1980, 10:00 a.m.
Trading Strategy: XICO has been traveling at the speed of Mars for over a year now, moving from about $2 a share to a price range roughly 7 times that amount. Transiting Jupiter is currently crossing the XICO First-Trade Midheaven, something we normally associate with a top, but in this case there’s also First-Trade Zeus at play, sitting just a degree and a half away from the MC position on a geocentric 16.97 line. Heliocentric 24 lines for Jupiter and Pluto help define the trading range, with the True North Node also coming into the picture. On balance, this is still a situation in which we expect the price to decline. If we get a close below Pluto at 11.57 this week, we will add a short position to the Model Portfolio, setting our initial buy stop at 13.33.


FINANCIAL CYCLES (ISSN 1055-8527) is published by Taylor-Bost Consulting and edited by Tim Bost at Post Office Box 1657, Sarasota, FL 34230-1657 USA. Phone: 941-953-3545. Fax: 941-953-3732. Email: timbost@pipeline.com. Entire contents copyright 2003 Timothy L. Bost. No portion of this Weekly Email Update or its printed version may be reproduced without the publisher's written permission. Subscriptions to FINANCIAL CYCLES are $39.00 per month for weekly updates by email or fax, payable by monthly billing to a major credit card. Advance payment options (by credit card, check, or money order) are $228 for 6 months, $432 for 1 year or $815 for two years. All subscriptions are payable in US funds only— Visa, MasterCard, American Express, Diners Club, and Discover/Novus accepted; please make checks or money orders payable to Taylor-Bost.

By providing a source of independent market analysis, the purpose of FINANCIAL CYCLES is to foster the growth of person-centered business and investment astrology; to enhance the development and dissemination of financial literacy and prosperity consciousness; and to explore the use of technical analysis and financial astrology in promoting an esoteric spiritual understanding of economic trends, geocosmic cycles, geopolitical events, and market movements. FINANCIAL CYCLES is a general interest publication which is prepared from astrological information, news reports, cycle projections, and market observations which are believed to be accurate and reliable, but which cannot be guaranteed. Portfolio and trading reports in this publication do not include taxes and transaction fees, which should be taken into consideration by prospective traders and investors. Even with accurate information, past performance is no guarantee of future results. Speculation in securities and commodities involves considerable financial risk, and readers who plan to invest or speculate in securities or commodities mentioned in FINANCIAL CYCLES have the complete responsibility for making themselves fully aware of all the risks involved before they invest. The editor may or may not have positions in the securities and commodities discussed in this newsletter, and the information in FINANCIAL CYCLES should in no way be understood or construed as a solicitation or an offer to buy or sell any products or securities, nor should the material published in this newsletter be considered buy/sell advice.

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posted by Tim Bost @ 12/07/2003 09:59:00 PM