What To Watch In Stocks This Week; Gold; Top 2014 Tech Trends

Stock Market Performance Thanksgiving Week; Top Tech Trends For 2014

      Good day to all.  With just 25 trading days left in 2013 we are entering what is historically and traditionally the most bullish time period for stocks all year.  For the week of Thanksgiving, the DOW is up 55% of the time, the S&P 50% and the NSADAQ 65% of the time.  All three indices have averaged gains of close to one percent between Thanksgiving and December 31 going back many decades.

     Last week, stocks finished higher for the seventh consecutive week with the DOW and (S&P) at record highs.  For the week, the DOW gained 103pts. or 0.6% to 16,064; while the (S&P) rose 7pts. or 0.4% to 1804.76; and, the NASDAQ added 6pts. or 0.1% to 3991.65.  For the year, the DOW is up 22.59%, the (S&P) +26.54% and the NASDAQ +32.2%.

 What To Watch This Week      

      Tuesday we get U.S. 3rd quarter GDP and consumer confidence numbers.  More of interest to traders will be 4th quarter 2013 and 1st. quarter 2014 GDP projections.  With all the health insurance cancellations across the country — +5M — and the sticker shock confronting many of those who actually do successfully log onto Obamacare, you have to wonder if consumer confidence and consumer spending (which is 70% of our economy) begins to suffer.  There is lots of anxiety out there over potential loss of insurance, loss of physician, and loss of preferred hospital care.

      On Wednesday, we get initial jobless claims (normally Thur; but Wed instead due to Thanksgiving) which have been averaging in the neighborhood of 330K.  We also get personal income and 3rd quarter durable goods orders.  This will be a key data week for the Federal Reserve prior to their final 2-day FOMC meeting (Dec. 17/18) for the year as the Fed considers when to begin QE Tapering.  A good portion of traders believe that without QE Tapering the S&P would be 10%-15% lower than Friday’s close.  Michael Matousek, Head Trader at U.S. Global Investors said, “the big money would sell bonds down hard if they got the idea that QE Tapering is coming anytime soon.”

What’s Wrong With Gold?

     William O’Neil, Managing Partner at Logic Advisors and former Head of Commodities Trading at Merrill Lynch is bearish on gold in the short-term.  He says the money flow into the yellow metal has been “terrible;” most of the big players (i.e. Soros) are pulling out of gold; and, traders are starting to short gold futures.  He believes gold is likely to fall below $1200 an ounce by early next year, or sooner.  Miguel Perez-Santalla, a gold and silver strategist and VP at Bullion Vault also sees more downside for gold in the short-term.  He forecasts gold to bottom between $1050 – $1100 before it rights the ship.  Both men are bullish on gold longer-term and both recommend dollar cost averaging or buying into gold as the yellow metal retreats.  I may have to start doing that again.

 Some Early Top Tech Predictions For 2014

      Alex Sacerdote, WhaleRock Capital Founder and Portfolio Manager and one of the top hedge fund managers on “the street” (very impressive 41% return ytd. with $600M under management) shared his top picks for the end of this year and into 2014.  His top pick is China’s Softbank, which he calls “the mother of all S-Curves.”  Softbank has 5% of China’s e-commerce market (including for Alibaba), and Mr. Sacerdote is forecasting the company to garner as much as 25% within a very short time period.  I will probably take a position in Softbank tomorrow (Mon.) morning.  Other top WhaleRock picks include: Amazon, Yahoo, Qihoo (ticker: QIHU), Apple, and Pandora.

      Top tech sectors for 2014 include:  Cyber security, data mining, digital currency/digital payments (PayPal, Google Wallet, Square, etc.), wearable, real-time information sharing via “Google Tattoo” (integrated into clothing, jewelry, on our skin), and 3-D Printing among others.  It will also be interesting to see how BitCoin evolves — will it become the digital currency of choice; or, is it just a passing fad and because of its lack of regulation — destined for failure?  All for now.  V/R, RCP

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