Trade Diary
I think the year to come is going to offer up a whole load of surprises that will make 2008 look like a good year. These are only my speculative musings and are based on what appears to be coming in the year ahead from the dire economic news we are receiving. I’m only looking into the first few months because as we now know the rate of change and disclosure is unprecedented.
January 2009
The motor industry will continue its begging act and sales will dry up completely. This will lead to a return to Capital Hill and the possible failure, merger or Bernanke miracle plan to save the ailing industry.
The start of January will reveal more on the Madoff scandal and based on dismal Christmas sales forecasts will be reduced dramatically leading to the FTSE 100 hitting 4000. Oil will continue downwards trading in a range of 35 Dollars to 45 Dollars. I will hopefully close my positions on the FTSE 100 at the 4000 exit point.
The end of January will lead to the take over of the Obama administration and bold political moves combined with the greatest stimulus package ever heard of along with heart warming rhetoric will rally U.S sentiment on the hope of change. The fact that we may finally have a leader who can take control will rally the markets by 15-20%.
February 2009
The continuation of the rally in equities along with the full details of the Obama strategy will be revealed. More bad news may quell the market rally. Dismal employment numbers and GDP will continue to create disquiet in the market place. The FTSE may reach 4700+.
March 2009
This is the month that it all falls apart. The realisation that Obama is only one man and that this is a global affair will cause equities to reevaluate how effective this huge 1 Trillion spend has been and further write downs, profit warnings and job losses will lead to a new low for the FTSE 100 of 3400. The U.S motor industry will be back begging as will a few other industries. The outlook will be bleak.
April – August 2009
After March I’m not too sure but my speculation is that well off the lows a gradual stabilisation may begin to occur as global political efforts take effect. The FTSE 100 will climb back to 4200.
September – December 2009
After a roller coaster year where many industries fail mergers begin to occur and the gradual catharsis begins to take effect. A stabilisation in job numbers and a pick up in new home sales leads to a positive market outlook as the FTSE 100 heads for 4500+. Things are starting to look a little rosier.
Disclaimer: These are just my personal opinions and for all I know the FTSE could hit 6000 or 3000 but I think we can be assured one thing. The roller coaster ride is only half way around and the ride of a lifetime continues.
Merry Christmas to all and Happy trading in the New Year.
P.S. Here is what Doug Kass has to say on 2009.
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Hey Chris, a happy new year to you.
I think you are a brave man to stick your neck out like this, as
invariably those who do this are made to look silly as the year progresses.
(Just look at the analysts in December 07 making predictions of the position
of the FTSE at 2008 year end) – but I wouldn’t say anything you have suggested looks foolish based on the current knowledge.
My only contribution is that I think the Hedge fund story isn’t over yet by far (the Madoff story is the prelude, just like Northern Rock’s collapse in 07 was the prelude to the bigger bank crisis in 08) – there is I think going to be a huge and continuous culling of these organisations, and it’s impact on the market (fire-sales) and the future of leveraged trading will be watershed.
But hey, what do I know?
Good luck with your trades mate, and keep up the good work with the blog!
Jez
Yeah I’m starting to regret the post all ready. It’s only a bit of fun and as a beginner I don’t think too many people will pay too much attention.
Well done please give your predictions for 2010!