HSL / Newsletter Sample

US Market
October 2004

could dive. I’ve given guidelines in our Futures section for fine-tuning the mkt averages as usual. •••See the DJ World Index chart on this page. If it was a stock, U’d buy it. That keeps me from being bearish. •••Personally, I’m doing some light buying, mostly in energy stocks, a steel, 1-2 commodities, golds, a China & an India fund, defense & pollution stks. Read our New Recommendations list, pg 10; lots of good buys there. All have stops on them to protect on the downside.

••I’ll bet most of U don’t read our Closed Positions list. U should. It reveals profits/losses each time. U’ll be amazed at what a good batting average is going on under your nose. With stops, there is little to fear, much to gain. I don’t just buy, of course. I also sell, as soon as a modest profit appears. If U don’t take profits, U will usually wish U had. Also, when a stk gives U a profit it usually means it’s overbought at that point, so why not sell, say thank U, & await the next train. •••Note: Avg US mutual funds have underperformed the stk averages for years. U can do better yourself (well, with HSL help ☺). •••Yes, it bothers me the consensus shows too many bulls, too few bears, but that has been going on for many months. And with the US govt supporting the S&P, the upside bias has the upper hand. Yes, stks are overvalued, but that’s non-specific to the clock. •In any case, I’m not talking mkt averages here, but rather certain groups & indiv stks. ••Pull up stops tight before the US election in case of a sharp fall if the “wrong” man wins (whoever that is). •••US bonds gave a chart sell signal, IMO, on Oct 1. Treasury Bonds had risen to my uppermost tgt at 109 & died there, on target. Many claimed it was a bond bull mkt; I said it was only a pullback rally. •• BL: it’s ok for U to drive your car if U wear seat belts. It’s ok to buy stocks here if U wear stoploss orders.

••Market-Track: DJIA: at 10192.65, is 105.73 pts below its key 200-day moving average (MA) at (10298.38). S&P500: at 1131.50 is 13.08 pts above its 200-day MA (1118.42). Nasdaq Comp: at 1452.94 is 130.75 pts above its 200-day MA (1440.69). Thus, S&P500 & Nasdaq Comp are bullish basis the 200-day MA, while DJIA remains bearish.

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