FinancialCyclesWeekly.com #0431 – August 1-7, 2004 with Tim Bost

COMMENT: A Jupiter/Pluto square is currently in sway, adding a huge potential for market volatility and for ostentatious displays of power. Since Jupiter is associated with religion, world affairs, and legal matters, and since Pluto has connections with tremendous forcefulness, we could be due for more terrorist activities, governmental posturing, and expressions of religious fanaticism.
Right on schedule with the Jupiter/Pluto energy that’s coming to a head this week, the U.S. Department of Homeland Security has warned that the New York Stock Exchange, the headquarters for Citigroup Inc., the International Monetary Fund in New York, as well as Prudential Financial Inc.'s headquarters in Newark, New Jersey, and the World Bank building, (which is two blocks from the White House in Washington, D.C.) are all under threat of immediate terrorist attack. This ominous announcement could certainly have a chilling effect on trading activity as the week gets underway, but while we may see some wild swings to the downside in stocks, we could also get some big moves up in gold, oil, and other futures contracts for key commdodities.
That doesn’t necessarily include duct tape, however. A couple of years ago, when the Department of Homeland Security was just getting underway and when Level Orange terrorist alerts were far more commonplace (as they’re likely to be again in the months leading up to the presidential election), duct tape was held up as the ultimate solution for civil defense and emergency preparedness. Apparently the public responded to this suggestion so dutifully that most folks now have an ample supply on hand, and find themselves wondering what to do with it.
Gary Jones is a case in point. The 49-year-old man from Punta Gorda, Florida was stabbed in the buttocks during a knife fight outside JD’s Lounge early last Thursday, and unsuccessfully used duct tape on his derriere in an effort to stop the bleeding. When the government-approved remedy didn’t work, Jones went to a local hospital for help, where local authorities were summoned after his wounds had been examined.
Jones told police that he didn’t want to file any criminal charges against the knife-wielding assailant who had attacked him outside the bar. According to the police report, Jones said he had probably done something to deserve it. Like carrying around too much duct tape, perhaps?

FOLLOWING THE FLOW
“Follow the money.” That’s long been a useful rule of thumb for deciphering geopolitical events, propaganda, and business machinations, whether they’re underhanded or legitimate. Just figure out who’s making money and where the money is coming from, and you’ll have a handy skeleton key that will unlock even the most puzzling situations.
Today, of course, you could just as easily say “follow the oil.” So many of the current money-making dynamics in the world and the events that are impacted by them are soaked in crude that it’s difficult to ignore the role that Black Gold plays. It’s an underlying factor in the manufacture and transportation of just about everything, so it figures powerfully in understanding inflation and the general viability of businesses. It’s a key component in the current crisis in the airline industry. It’s at the heart of the Yukos scandal, of course, not to mention Iraq.
Or Sudan. That’s right, Sudan. The U.N. Security Council has just approved a resolution threatening sanctions against the Sudanese government if there isn’t a stop to the genocide there: fighting in the western Sudanese region of Darfur has killed 30,000 people and created nearly a million refugees. The U.N. resolution came after the U.S. House of Representatives passed its own resolution a couple of weeks ago, essentially giving President Bush approval to commit U.S. troops to Sudan should the Darfur situation not be resolved.
But is all this really about genocide? After all, there has been a bloody civil war in Sudan for the past 21 years, which has taken nearly 2 million Sudanese lives. During most of that time the U.S. looked the other way. The U.S. did prohibit trading with Sudan in 1997, but the Sudan Peace Act of 2002, which laid out much more severe sanctions, has largely been ignored. In fact, as recently as April President Bush decided not to impose additional sanctions against Sudan.
So what’s going on? Why has Sudan suddenly become the focus of outrage, when it wasn’t all that important just a few years ago? We think the answer is oil.
An oil pipeline began pumping crude to Port Sudan on the Red Sea in late 1999, and since that time Sudanese oil production has skyrocketed, up to a current 345,000 barrels a day. In 2001, the estimate of the crude oil reserves in Sudan was 262 million barrels; that figure was revised last January to 563 million barrels. Industry experts say it’s possible that Sudan could be producing 750,000 barrels of oil a day by the end of 2006. There’s a good analysis of the Sudanese oil situation available on the web from the U.S. Department of Energy at http://www.eia.doe.gov/emeu/cabs/sudan.html.
All this is not to say that there aren’t atrocities going on in Sudan, or that they don’t deserve international attention and intervention. The timing is certainly interesting, however, especially when you start to follow the money.

VENUS MARKS MARKET SWINGS
We noted last week in our forecast that we were expecting “a short-term rally to get underway this week,” and stock prices indeed rose in the U.S. equity markets. We had based our projection primarily on the anticipated impact of the Venus/Pluto opposition, but it took a Jupiter trigger to the Sun/Venus occultation point to really get things rolling. The most recent swings in U.S. equities have all been Venus-linked: a bottom coinciding with the simultaneous stations of Venus and Neptune on May 17, a top just after the “transit of Venus” occultation on June 8, and another bottom with the July 28 square of transiting Jupiter to the Sun/Venus occultation point.

EDUCATION FOR ASTRO-TRADERS
Ted Phillips will be teaching a Galactic Trader Basic Training Workshop on September 21 and 22 in Denver, Colorado. Focusing on the Galactic Trader software, the event will features ways to identify key reversal dates and demonstrate techniques for setting up planetary price lines to determine key support and resistance levels in multiple time frames. For more information on the event, call 904-260-1515 or send an email to pas24@aug.com.

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THE WEEK AHEAD

There are plenty of key earnings reports coming in this week; we’ll mention just a few of them that we’re keeping an eye on: Procter & Gamble (PG), Tyco (TYC), Prudential Financial (PRU), Clorox Company (CLX), and Emerson Electric (EMR). With so much potential for volatility this week, specific earnings reports are not likely to drive the broader averages too much.
The economic news this week will include reports on Construction Spending, the ISM Manufacturing Index, Personal Income and Outlays, Factory Orders, Motor Vehicle Sales, the ISM Non-Manufacturing Index, Jobless Claims, the Employment Situation, and Consumer Credit. In other words, there will be plenty to keep the pundits busy, and lots of handy excuses waiting in the wings to “explain” almost any conceivable market action.
There’s only one void-of-course period that will impact trading activity this week: for a couple of hours on Friday morning. Other than that, we are focusing astrologically on the August 6 Jupiter/Pluto square, which should color the trading activity all week, as well as the news front. With a heliocentric Mars/Uranus opposition and a Sun/Neptune opposition also in play, there’s lots of potential for confrontation and confusion along the way. Anybody ready for a vacation?
Have a great week!

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SPIRITUAL FOCUS FOR THE WEEK

The greatest traders have all understood that emotional balance is the key to successful trading. Through Practical Spiritual Astrology we have an opportunity to restore inner harmony, enhance emotional balance, and make wiser choices in the markets.

Opportunities await us to spread divine awareness in more creative and innovative ways as we cut through self-deception and take decisive steps toward greater abundance. If we avoid being dogmatic, we can get even better results!

"I have made mistakes, but I have never made the mistake of claiming that I never made one." - James Gordon Bennett

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GLOBAL EQUITIES MARKETS LAST WEEK

We noted last week that Hong Kong’s Hang Seng Index had put in a short-term reversal of a selling trend, but warned traders in that market that “The Hang Seng still hasn’t taken out its June highs, however, so it’s probably best to take the week’s good news with a grain of salt.” That proved to be the better part of wisdom, since the Hang Seng resumed its sell-off during the final week in July. All of the other markets that we track around the world also reversed, but in each case the move was a positive one!

Dow Jones Industrial Average – up 1.78%
Dow Jones Transportation Average – up 2.24%
Dow Jones Utilities Average – up 1.59%
S&P 500 – up 1.43%
NASDAQ Composite Index – up 2.07%
Russell 2000 – up 2.24%
London FTSE-100 – up 2.01%
Paris CAC-40 – up 2.24%
Frankfurt DAX – up 2.59%
Sydney All Ordinaries – up 1.44%
Tokyo Nikkei – up 1.24%
Hong Kong Hang Seng Index – down 0.93%
Singapore Straits Times Index – up 2.24%

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FINANCIAL CYCLES MODEL PORTFOLIO


POSITIONS CLOSED DURING THE PREVIOUS WEEK: CRDN, VCBI, ABFS.

We closed three Model Portfolio positions during the past week, with 3 losers producing a net loss of $814.00.

On July 26 we sold 200 shares of Ceradyne Inc. (CRDN) at 35.20, taking a loss of $120.00 (a 1.68% loss in 7 trading days).

On July 27 we sold 400 shares of Virginia Commerce Bancorp (VCBI) at 22.80, taking a loss of $544.00 (a 5.63% loss in 4 trading days).

On July 29 we bought to cover 300 shares of Arkansas Best Corporation (ABFS) at 35.00, taking a loss of $150.00 (a 1.45% loss in 6 trading days).

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POSITIONS ADDED TO THE PORTFOLIO DURING THE PREVIOUS WEEK: CEDC, CRHCY, CYTC, HMC, SHFL.

We added five long positions to the Model Portfolio during the previous week.

We bought 500 shares of Central European Distributing Corporation (CEDC) at 22.45 on 07/27/04, setting our initial stop at 20.50.

We bought 500 shares of CRH PLC ADR (CRHCY) at 22.22 on 07/29/04, setting our initial stop at 21.40.

We bought 500 shares of Cytyc Corporation (CYTC) at 22.25 on 07/29/04, setting our initial stop at 21.00.

We bought 400 shares of Honda Motor Company Ltd. ADR (HMC) at 23.88 on 07/29/04, setting our initial stop at 22.00.

We bought 300 shares of Shuffle Master Inc. (SHFL) at 31.50 on 07/29/04, setting our initial stop at 28.53.

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YEAR-IN-REVIEW MODEL PORTFOLIO ACTIVITY

So far in 2004 we have had a total of 120 completed trades, with 55 winners and 65 losers bringing us a total net profit of $21,749.50. The largest profit for a single trade has been $5,645.00; the largest single-trade loss has been $750.00; the average profit per trade has been $181.25. The mean duration of our trades has been 9.6 trading days.

During 2003 we had a total of 176 completed trades, with 99 winners and 77 losers bringing us a total net profit of $51,717.00. The largest profit for a single trade was $9,240.00; the largest single-trade loss was $1,170.00; the average profit per trade was $293.85. The mean duration of our trades was 10.1 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

Central European Distributing Corporation (CEDC) – bought 500 shares at 22.45 on 07/27/04; currently 24.11. Raise stop to 22.00.

CRH PLC ADR (CRHCY) – bought 500 shares at 22.22 on 07/29/04; currently 22.50. Raise stop to 21.75.

Cuno, Inc. (CUNO) – bought 200 shares at 49.75 on 07/23/04; currently 52.66. Raise stop to 50.25.

Cytyc Corporation (CYTC) – bought 500 shares at 22.25 on 07/29/04; currently 24.10. Raise stop to 21.50.

Dawson Geophysical Company (DWSN) – sold short 400 shares at 24.50 on 07/08/04; currently 22.05. Lower buy stop to 22.35.

Honda Motor Company Ltd. ADR (HMC) – bought 400 shares at 23.88 on 07/29/04; currently 24.27. Raise stop to 22.75.

MTR Gaming Group (MNTG) – sold short 1,000 shares at 11.00 on 07/13/04; currently 9.72. Lower buy stop to 10.40.

Shuffle Master Inc. (SHFL) – bought 300 shares at 31.50 on 07/29/04; currently 31.98. Raise stop to 30.75.

Wal-Mart Stores (WMT) – bought 200 shares at 52.75 on 07/19/04; currently 53.01. Raise stop to 52.12.


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STRONGEST MARKET SECTORS LAST WEEK

Air Services; Steel & Iron; Metal Fabrication; Copper; Healthcare Information Services.

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WEAKEST MARKET SECTORS LAST WEEK

Education & Training Services; Waste Management; Drug Stores; Hospitals; Long Distance Carriers.

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KEY ASTROLOGICAL EVENTS DURING THE COMING WEEK

August 1
Mercury square Cupido in right ascension 00:19 EDT
Mercury semisextile Zeus in right ascension 02:51 EDT
Heliocentric Earth sextile Heliocentric Cupido 05:33 EDT
Mercury opposition Uranus 07:00 EDT
Heliocentric Mercury semisquare Heliocentric Poseidon 10:00 EDT
Heliocentric Mercury conjunct Heliocentric Pluto 10:26 EDT
Venus semisextile Vulcanus in right ascension 10:31 EDT
Mercury semisquare Saturn in right ascension 13:13 EDT
Heliocentric Venus semisextile Heliocentric Neptune 13:43 EDT
Void-of-Course Moon begins 16:51 EDT
Heliocentric Mercury quincunx Heliocentric Admetos 20:38 EDT
Mercury trine True Lunar Node 21:49 EDT
Mars contraparallel Pluto in right ascension 23:05 EDT
Mars contraparallel Pluto 23:09 EDT

August 2
Markets in Canada and Australia closed
Heliocentric Mercury quincunx Heliocentric Vulcanus 00:15 EDT
Void-of-Course Moon ends 00:34 EDT
Heliocentric Venus parallel Heliocentric Apollon 03:18 EDT
Heliocentric Mercury opposition Heliocentric Hades 03:55 EDT
Mars square 5/16/2003 Lunar Eclipse Point 04:07 EDT
Heliocentric Mercury sextile Heliocentric Apollon 05:21 EDT
Heliocentric Earth sesquiquadrate Heliocentric Jupiter 07:20 EDT
Heliocentric Mercury semisextile Heliocentric Chiron 07:36 EDT
Mars contraparallel Chiron in right ascension 10:11 EDT
Mars contraparallel Chiron 10:18 EDT
Saturn sesquiquadrate Cupido in right ascension 10:21 EDT
Heliocentric Mercury in 24th harmonic to Heliocentric Cupido 14:47 EDT

August 3
Heliocentric Mercury square Heliocentric Jupiter 00:07 EDT
Mercury sesquiquadrate Chiron in right ascension 06:04 EDT
Heliocentric Earth semisquare Heliocentric Mercury 08:17 EDT
Mercury opposition Uranus in right ascension 12:50 EDT
Mercury sesquiquadrate Chiron 14:56 EDT
Void-of-Course Moon begins 22:58 EDT
Mercury semisextile Zeus 23:07 EDT

August 4
Heliocentric Venus trine Heliocentric Saturn 00:06 EDT
Void-of-Course Moon ends 03:59 EDT
Heliocentric Mars opposition Heliocentric Uranus 04:26 EDT
Heliocentric Mercury semisquare Heliocentric Neptune 05:49 EDT
Mercury semisquare Apollon 14:26 EDT
Heliocentric Mercury enters Capricorn 14:38 EDT
Sun semisquare Venus 17:27 EDT

August 5
Heliocentric Mercury opposition Heliocentric Kronos 00:57 EDT
Heliocentric Venus in 24th harmonic to Heliocentric Uranus 02:28 EDT
Jupiter trine Admetos in right ascension 16:59 EDT
Heliocentric Earth parallel Heliocentric Neptune 17:22 EDT
Sun contraparallel Neptune 17:30 EDT
Sun contraparallel Neptune in right ascension 17:33 EDT
Mercury semisquare Vulcanus 19:23 EDT
Heliocentric Earth conjunct Heliocentric Neptune 22:59 EDT
Sun opposition Neptune 23:07 EDT
Sun opposition Neptune in right ascension 23:38 EDT
Mars parallel True Lunar Node 23:49 EDT

August 6
Heliocentric Venus sesquiquadrate Heliocentric Poseidon 02:44 EDT
Mars parallel True Lunar Node in right ascension 02:45 EDT
Venus sesquiquadrate Neptune 02:51 EDT
Heliocentric Venus square Heliocentric Pluto 03:51 EDT
Mercury square Cupido 04:14 EDT
Heliocentric Mercury sextile Heliocentric Uranus 05:50 EDT
Void-of-Course Moon 09:59 – 11:26 EDT
Mars contraparallel Poseidon 11:23 EDT
Sun semisquare Kronos in right ascension 12:04 EDT
Mars contraparallel Poseidon in right ascension 12:17 EDT
Jupiter semisextile Apollon in right ascension 13:09 EDT
Heliocentric Mercury trine Heliocentric Mars 14:39 EDT
Jupiter square Pluto 17:30 EDT
Heliocentric Mercury sextile Heliocentric Poseidon 19:21 EDT
Heliocentric Mercury in 24th harmonic to Heliocentric Pluto 20:00 EDT
Heliocentric Venus sextile Heliocentric Admetos 21:11 EDT

August 7
Heliocentric Venus trine Heliocentric Vulcanus 03:27 EDT
Saturn sesquiquadrate Uranus 04:26 EDT
Heliocentric Mercury sesquiquadrate Heliocentric Admetos 05:40 EDT
True Lunar Node direct station 06:58 EDT
Venus enters Cancer 07:00 EDT
Heliocentric Venus square Heliocentric Hades 09:56 EDT
Heliocentric Mercury square Heliocentric Zeus 11:56 EDT
Heliocentric Venus quincunx Heliocentric Apollon 12:19 EDT
True Lunar Node retrograde station 14:45 EDT
Saturn conjunct 5/31/2003 Solar Eclipse Antiscion 16:09 EDT
Heliocentric Mercury in 24th harmonic to Heliocentric Chiron 17:07 EDT
Heliocentric Venus sextile Heliocentric Chiron 17:45 EDT
Heliocentric Mars sextile Heliocentric Poseidon 21:24 EDT
Heliocentric Mercury semisextile Heliocentric Cupido 23:16 EDT

August 8
Mercury parallel Jupiter in right ascension 06:08 EDT
Heliocentric Earth sesquiquadrate Heliocentric Kronos 06:34 EDT
Mercury parallel Jupiter 06:38 EDT
Saturn opposition Chiron in right ascension 14:24 EDT
Venus sesquiquadrate Neptune in right ascension 19:23 EDT
Void-of-Course Moon 20:46 – 22:33 EDT
Sun semisquare Kronos 22:20 EDT

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STOCKS TO WATCH: CLDN, MCRS, ZEUS, REXI, STTX.


Celadon Group (CLDN)
NASDAQ
First Trade Date: 01/21/1994; 09:30 a.m.
Trading Strategy: CLDN likes to travel at the speed of Venus (G,30.24,N,0), and it looks like it’s coming out of the recent Venus retrograde period with some good momentum. Transiting Jupiter crossing the CLDN First-Trade Descendant should add to the action in a positive way, so we will be putting on a long position this week, setting our initial stop at 16.45, in keeping with the First-Trade Pluto line (G,23.76,N,0).


Micros System Inc. (MCRS)
NASDAQ
First Trade Date: 02/10/1981; 10:00 a.m.
Trading Strategy: When transiting Mars formed an opposition to the MCRS First-Trade Sun recently, just as transiting Venus was square the MCRS First-Trade Ascendant, this stock started to shoot up in price. This week, however, transiting Saturn will conjoin the MCRS First-Trade IC, so we think the rally will come to an abrupt end. Planetary lines for Apollon (G,18.93,N,0), Saturn (G,18.93,N, 0), and Poseidon (G,20.54,N,0) have significantly defined the price moment of this stock in the past; we’ll be using them to anticipate resistance as we set our initial buy stop at 49.08 as we add a short position to the Model Portfolio this week.


Olympic Steel Inc. (ZEUS)
NASDAQ
First Trade Date: 03/10/1994; 09:30 a.m.
Trading Strategy: Wow! This stock has shot straight up during the past week of trading! Wow! Transiting Jupiter is in opposition to its First-Trade Sun! Wow! That aspect will be going away very quickly, so we’re going to sell ZEUS short this week, with a buy stop starting at 24.95! Wow!


Resources America Inc. (REXI)
NASDAQ; Optionable
First Trade Date: 03/10/1982; 10:00 a.m.
Trading Strategy: REXI has pulled back about 11% from its 52-week high, and it looks like it’s trying to get a rally underway. Transiting Pluto is square the REXI First-Trade Sun, however, and about the only positive thing that’s going for it astrologically is transiting Jupiter getting ready to accent that square with an opposition to the First-Trade Sun. Our plan is to sell REXI short this week, setting our initial buy stop at 23.75.


Steel Technologies Inc. (STTX)
NASDAQ; Optionable
First Trade Date: 08/27/1985; 10:00 a.m.
Trading Strategy: Transiting Hades is in a tight sesquiquadrate to the STTX First-Trade Jupiter and transiting Saturn is crossing the First-Trade Midheaven. At the same time, transiting Zeus is just moving out of a semisquare with First-Trade Saturn. This combination of factors suggests that STTX may have a solid opportunity to break out of the 20-23 trading range that has kept it occupied for the past four months. All we need is a little bit of confirmation from the stock itself. During the past few years a geocentric Admetos planetary line (G,42.1,N,0) has created key support and resistance for STTX, with a line for the True Lunar Node (G,41.8,N,0) adding secondary support/resistance zones. Currently STTX has established a foothold above the Admetos line; if we get a daily close above the Node line at 24.16 or higher, then we will enter a long position, setting our initial stop at 21.75.


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FINANCIAL CYCLES WEEKLY (ISSN 1055-8527) is published by Taylor-Bost Consulting and edited by Tim Bost at 2132 Beneva Road, Sarasota, FL 34232 USA. Phone: 941-921-2588. Fax: 941-927-5798. Web: http://www.TimBost.com. Entire contents copyright 2004 Timothy L. Bost. No portion of Financial Cycles Weekly may be reproduced without the publisher's written permission. Subscriptions to FINANCIAL CYCLES WEEKLY are $39.00 per month for weekly issues sent by email, 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. PayPal is also accepted for online orders; to subscribe go to http://www.TimBost.com/newsletter/subscribe.html.

By providing a source of independent market analysis, the purpose of FINANCIAL CYCLES WEEKLY 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 WEEKLY 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 WEEKLY 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 WEEKLY 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 @ 8/01/2004 03:16:55 AM