Where does the market go from here?

The article below are the views of Michael Markowski one of my trading associates. While I do believe the market is going lower overall in the coming months, I am not nearly as bearish as he is. I am expecting a 10-15% further decline in the market, he obviously is expecting much worse. There are always companies (stocks) with great value regardless of market conditions. If what he believes actually comes to fruition you will almost certainly be able to get those stocks later at lower prices.

Author: Michael Markowski
Written in the February edition of Equities Magazine.
Feb. 12, 2010 article: “Stocks Poised for Massive Sell Off”

The Euro’s recent steep decline versus the U.S. Dollar, which began in December is very bad new for the U.S. economy, stock market, commodities markets and the price of gold.

Did you know that since the Euro’s inception in 1999, its highs and lows as compared to its exchange rate with the U.S. Dollar have been accurate in predicting every significant rally and sell off in the U.S. stock market?

The Euro’s steep declines versus the U.S. Dollar in the late summer of 2008 and winter of 2009, preceded or precipitated the crashes in the U.S. stock market, which occurred in the Fall of 2008, and the Spring of 2009, respectively. Even the bursting of the dot com bubble in April of 2000 and the ensuing economic downturn in the U.S. can be blamed on a steep 15% decline in the Euro which began on January 3, 2000.

Since the Euro has already declined by 10% and continues to fall I expect that next shoe will soon drop, which will be a sharp sell-off in U.S. stocks. I am advising all of my family and friends to get into an 80% cash position in their stock portfolios, mutual funds and retirement plans.