Monday, May 4, 2009

Page 1
Dynamic Dow
f
orecast 2009
1
f
orecast for the week ending May 8
th
2009
May’s trading session starts with a positive measure of motion; to keep the bear market
rally advancing, the Industrials must trade above 7,974.20/7,790.94. Because these
minimum cycle points have already been met, the composition of the five/eleven major
harmonic waves points to a cycle crests within four to six months +/- two months.
From an intermediate seesawed trading week perspective, the Dow Jones Industrial
Average squeezed out 136 points to post positive intermediate momentum (p=mv). This
action reversed the wealth preservation status, from last week, and brings the Dow
within two weeks, +/- two weeks, of its intermediate cycle high. For continued positive
momentum through May 8
th
, the index must exceed 8,410.89/8,058.61.
In spite of the good news discussed so far, minor momentum turned negative; to reverse
that measure of motion through May 4
th
, the Dow will have to trade above
8,273.59/8,147.92 with an expected minor crest within one to three days.
Conclusion: the intermediate momentum measure improved from a +1 to a +3 neutral
reading. As increasing financial headwinds arise, beware of the exits.
Hamilton Lewis II MBA eB, CMT
Chartered Market Technician
Friday, May 1
st
2009/16:11hr.
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Cycles
Research
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Page 2
Dynamic Dow
f
orecast 2009
2
Domestic Industries, Intl ETF, & Broad Average Analysis
Friday May 1
st
2009
Rank
Seven
% Change
This
Three
Months
Industry
since
Jan 1
st
Week
Weeks Ago Ago
Name
2009
1
7
54
Retail-Restaurants
+ 28.80
2
1
136
Retail-Consumer Elect
+ 41.40
3
22
101
Retail-Leisure Products
+ 39.80
4
24
104
Internet - eCommerce
+ 33.50
5
5
103
Oil&Gas-Intl Exploration Prod
+ 17.30
193
153
92
Oil & Gas-US Royalty
- 13.90
194
171
29
Medical-Drugs/Diversified
- 16.90
195
178
3
Medical-Outpaitient/Hm-Care
- 18.80
196
195
177
Metal Products-Distributor
- 22.80
197
197
182
Textile-Mill/Household
- 52.10
International Exchange Traded Funds
Friday May 1
st
2009
Market Vector Russia (RSX)
+37.95
iShares MSCI Taiwan (EWT)
+35.84
iShares MSCI Brazil (EWZ)
+33.70
WisdomTree Emerging Markets (DGS)
+26.40
iShares MSCI Chile (ECH)
+25.82
SPDR Index Shares Fund (RWO)
-11.80
iShares MSCI Japan Small Cap (SCJ)
-12.67
Wisdom Tree Japan Small Cap Dividend (DFJ)
-15.87
Wisdom Tree Japan Equity Income (DNL)
-16.42
Direxion Developed Markets Bull 300% (DZK)
-30.20
Broad Averages vs. 2009 Long/Short Portfolio
Friday May 1
st
2009
Dow Jones Industrials Average
- 6.43
Dow Jones Transportation Average
-10.88
NYSE Composite Index
- 3.27
Standard & Poor’s 500 Index
- 2.85
NASDAQ Composite
+ 9.02
NASDAQ 100 Index
+15.27
Russell 2000 Index
- 2.50
Dollar Index
+ 3.99
Commodity Research Bureau Index
- 0.22
2009 Long/Short Portfolio – Net Gain
+63.61
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Cycles
Research
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Page 3
Dynamic Dow
f
orecast 2009
3
2009 Long/Short – Quantitative Stock Selections
Long:
The Mosaic Company (MOS) engages in the production and marketing of concentrated
phosphate and potash crop nutrients for the agriculture industry worldwide. The
company operates in three segments: Phosphates, Potash, and Offshore. The
Phosphates segment produces phosphate fertilizer which is used in crop nutrients and
feed phosphate for animal feed ingredients. The Potash segment produces and sells
potash that is used in the manufacture of mixed crop nutrients and animal feed
ingredients, as well as in industrial applications. These products are also used for de-
icing and as water softener regenerants. The Offshore segment produces and markets
phosphate-, potash-, and nitrogen-based crop nutrients and animal feed ingredients, as
well as operates sales offices, fertilizer blending and bagging facilities, port terminals,
and warehouses. It markets its products primarily to wholesalers, cooperatives,
independent retailers, and national accounts. The company was founded in 2004 and is
headquartered in Plymouth, Minnesota. The Mosaic Company is a subsidiary of Cargill,
Incorporated.
Price Objective: $47.37
Relative Strength (+)
Momentum is negative: 41.70/38.11
Projected high expected within two weeks.
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Research
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Page 4
Dynamic Dow
f
orecast 2009
4
Long:
HSBC Holdings plc (HBC)
Price Objective: $38.87
Relative Strength (+)
Momentum is positive: 38.68/33.89
Projected high expected within two weeks.
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Cycles
Research
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Page 5
Dynamic Dow
f
orecast 2009
5
Long:
Brazil index (EWZ) The investment seeks to provide investment results that correspond
generally to the price and yield performance of publicly traded securities in the Brazilian
market, as measured by the MSCI Brazil index. The fund normally invests at least 95%
of assets in the securities of its underlying index and in ADRs based on the securities in
its underlying index. It uses a representative sampling strategy to try to track the index.
The index consists of stocks traded primarily on the Bolsa de Valores de So Paulo. It is
nondiversified.
Price Objective: $53.00
Relative Strength (+)
Momentum is positive: 47.73/41.60
Projected high expected within eight weeks.
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Research
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Page 6
Dynamic Dow
f
orecast 2009
6
Short:
Wynn Resorts Limited, together with its subsidiaries, engages in the development,
ownership, and operation of destination casino resorts. The company owns and
operates Wynn Las Vegas casino resort in Las Vegas, which includes 22 food and
beverage outlets comprising 6 dining restaurants, 2 nightclubs, 1 spa and salon, 1
Ferrari and Maserati automobile dealership, wedding chapels, an 18-hole golf course,
meeting space, and foot retail promenade featuring boutiques. As of December 31,
2007, Wynn Las Vegas casino resort featured 140 table games, 1 baccarat salon,
private VIP gaming rooms, 1 poker room, 1,970 slot machines, and 1 race and sports
book. It also owns Wynn Macau casino resort located in the Macau Special
Administrative Region of the People’s Republic of China. Wynn Macau casino resort
featured 380 table games, 1,270 slot machines, 5 restaurants, 1 spa and salon, lounges,
meeting facilities, and retail space featuring boutiques. The company was founded in
2002 and is based in Las Vegas, Nevada.
Price Objective: $49.50
Relative Strength (+)
Momentum is positive: 48.78/38.29
Projected high expected within one to three weeks.
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Cycles
Research
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Page 7
Dynamic Dow
f
orecast 2009
7
Short:
Deutsche Bank Liquid Commodity Total Return Index (DEE)
The investment seeks to replicate, net of expenses, twice the inverse of the Deutsche
Bank Liquid Commodity Total Return Index. The index is intended to reflect changes in
the market value of certain commodity futures contracts based on crude oil, heating oil,
corn, wheat, gold and aluminum. The T-Bill Index is intended to approximate the returns
from investing in 3-month United States Treasury bills on a rolling basis.
Price Objective: $70.04
Relative Strength (-)
Momentum is positive: 91.62/82.72
Projected low expected within four weeks.
Global
Cycles
Research
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Page 8
Dynamic Dow
f
orecast 2009
8
2009 Long/Short Quantitative Portfolio
Friday May 1
st
2009
Current exposure:
80% long
40% short
Original Basis as of 01/02/2009
$24,474.00
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Cycles
Research
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Page 9
Dynamic Dow
f
orecast 2009
9
Total Gain/Loss: $15,567.00
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Cycles
Research
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Page 10
Dynamic Dow
f
orecast 2009
10
As of Friday May 1
st
@ 16:00 ET
Total Trades:
40
Profitable Trades:
28
Unprofitable Trades:
12
Win Ratio:
70.00%
Loss Ratio:
30.00%
Original portfolio basis on Jan 2
nd
2009
$24,474.00
Total Dollar Increase since Jan 2
nd
2009
$
15,567.00
Total percentage change since Jan 2
nd
2009
63.61%
As of Friday April 24
th
@ 16:00 ET
Total Trades:
31
Profitable Trades:
23
Unprofitable Trades:
8
Win Ratio:
74.19%
Loss Ratio:
25.81%
Original portfolio basis on Jan 2
nd
2009
$24,474.00
Total Dollar Increase since Jan 2
nd
2009
$12,772.00
Total percentage change since Jan 2
nd
2009
52.19%
As of Friday April 17
th
@ 16:00 ET
Total Trades:
31
Profitable Trades:
23
Unprofitable Trades:
8
Win Ratio:
74.19%
Loss Ratio:
25.81%
Original portfolio basis on Jan 2
nd
2009
$24,474.00
Total Dollar Increase since Jan 2
nd
2009
$12,772.00
Total percentage change since Jan 2
nd
2009
52.19%
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