January 2010 In Review – February Preview
Apart from starting a new batch in January, there isn’t much else to review for the month of January. About the only thing worth talking about is how the market went from bull to bear in a matter of a week and changed the entire complexion of what was supposed to be a great start to the year. Another ominous start to the year was the tragic 12 January 7.0 Magnitude earthquake in Haiti that took 170,000 lives. Pray for their souls.
One of the things I did in January was to attend Joey Yap’s one day seminar at Raffles City with my wife. If you’re into Fengshui, then you might want to know that Dragons are expected to have a great year but we have to mind our health. Joey had nothing but bad news for Snakes and Tigers but saved the worse for Rats – the Rats have it real bad for the year of the Metal Tiger. The same thing was confirmed by Fengshui Master and friend, Andrew Tan during our Christmas Gathering in December.
Also related to the year of the Tiger is the probability of war and conflict. Through the ages, some of the fiercest conflicts occurred in Tiger years. What are the chances that it will happen again?
Apart from all that, January has been a non-event and I like it that way.
Now we go into February and the Year of the Metal Tiger.
As far as the market goes, January started up but quickly became a downer and closed with a Bearish January Barometer, indicating a choppy and volatile year ahead. Considering the prevailing conditions, I’m not surprised. I just finished writing a piece for Invest Magazine where I sounded out my thoughts about the coming year and amongst the things I mentioned were the current economic situation in the U.S.;
- unemployment has not bottomed out and it doesn’t seem to want to stop plummeting,
- the ever continuing problem with foreclosures,
- increasing mall vacancies and the growing stockpile of existing homes,
- high commodity prices as a result of cheap money
- a national debt that is growing at parabolic and exponential rate
The global economic health is also far from the recovery picture that was being painted just two months ago by many economists and analysts;
- the ever growing concerns over China’s monetary policies,
- the debt drag on Greece with Spain, Portugal and Italy,
- America’s continued persistence with cheap money and the repercussions of its effect on global asset bubbles,
- Dubai’s long term debt and its effect on the Arab community
- the failure amongst the bankers and policy makers in Davos to reach any conclusion about coordinated global regulation.
Grab your copy when it hits the news stands to find out how to balance your portfolio if the market turns choppy and volatile.
February is going to be a short month with only 19 trading days in the U.S. and even less in Singapore because of the long break for Chinese New Year. In recent years, February has been more bearish than bullish … we haven’t had a positive February since 2006. It should start the week on a bullish note, albeit modestly.
February is known as “the weakest link” in the best six months on the DOW and S&P500 between end October and mid May. The most bearish part of the month is the last two weeks of this short month. As previously mentioned, there are only 19 trading days in February with Monday 15 February being President’s Day when the markets will be closed. February Expiration Friday has been down on the DOW 7 out of the last 10 years.
Now that the January Barometer has been confirmed as bearish, we will have to keep a close watch on that December low of 10,235.63 over the next two months. Failure to break above that level by the end of Q1 will send the bears out in full force for the rest of the year assuming the hidden hand of the PPT doesn’t repeat their performance of 2009.
Before I sign off, here are several pictures of a memorable dinner I had with some of my traders on 8 January 2010.
And after finding some time to do this, I’ve finally managed to upload my Japan Holiday pictures. Here are some of my favorites.
Yup, we had a good time. And talk about being blessed … if you didn’t know, Mt Fuji is a shy mountain and to get a super clear day like the one we got is so rare. One hour after that picture as we emerged from lunch, the mountain went into hiding again and never emerged even when we left Japan four days later.
Looking at my kids today and reflecting on everything that has happened since they were born, I am indeed a happy puppy and a very contented father who could ask for little more.
Life is too short and worries are too many. I prefer to look at the great things that life has to offer, be thankful for what life has already granted and not dwell on the negatives at all. I guess that’s the attitude that got me to where I stand today.
As we go into a brand new Chinese New Year, I’d like to wish all my readers, traders and friends;
A Very Prosperous and
Most Happy Lunar New Year
And may all your dreams materialize
That you may enjoy life for what it truly is -
AWESOME!
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