Market Bias Forecast July 2007 Copyright 2007, A New Story Foundation, Inc All rights reserved.
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Transcript of Market Bias Forecast July 2007 Copyright 2007, A New Story Foundation, Inc All rights reserved.
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Market Bias Forecast
July 2007
Copyright 2007, A New Story Foundation, Inc
All rights reserved.
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What is a Market Bias Forecast?
• In researching social instability, A New Story Foundation has developed a highly successful method for forecasting market movement in several key commodities and equity indices.
• Market Bias is the composite outlook of a quantified estimate of bullish and bearish investors’ perspectives.
July 2007 Market Bias Forecast. Copyright 2007, A New Story Foundation, Inc.
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Market Bias
• Using a symbol set to represent the collective mood of bullish traders, a story is compiled for the market movement from that perspective.
• Strength of change is estimated for the entire month and for each time segment.
• The procedure is then repeated for the bearish perspective.
• Strength numbers for both bulls and bears are averaged. A price chart / price range is derived from these composite numbers.
July 2007 Market Bias Forecast. Copyright 2007, A New Story Foundation, Inc.
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July 2007 – Summary
• Theme: Extremely volatility!• Crude soaring and then down, The Stock
Market falls hard after the 4th of July holiday, the US Dollar joins it within a week.
• We have modified our forecasting method which could double the previous accuracy to at least 2 out of 3 forecasts 90%+ correct (from 1 out of 3).
July 2007 Market Bias Forecast. Copyright 2007, A New Story Foundation, Inc.
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Crude Oil
• Bullish perspective for July:“A bit more, and then profit taking
time.” • Bearish perspective for July:
“The economy can’t sustain these high prices .”
• Overall strength of change is very slightly
bearish: -1 (out of max -5)
July 2007 Market Bias Forecast. Copyright 2007, A New Story Foundation, Inc.
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Crude Oil - price
• Crude should continue to climb the first half of the month, with a steep sell-off into August.
July 2007 Market Bias Forecast. Copyright 2007, A New Story Foundation, Inc.
% Price Change, Cumulative - July 2007
-10
-8
-6
-4
-2
0
2
4
6
8
10
2 9 16 23 30 3-Aug
Crude Forecast 1 New Method
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Crude Oil - range
September contract expected high 77, low 68, close 68.50 for a net loss of 3.4% for the month.
Crude Oil Range - July 2007
68
69
70
71
72
73
74
75
76
77
78
Forecast
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S&P Index Futures
• Bullish perspective for July:“This can’t be the top of the market
yet.” • Bearish perspective for July:
“The volatility either way makes direction difficult to determine.”
• Overall strength of change is moderately
bearish: -2.5 (out of max -5).
July 2007 Market Bias Forecast. Copyright 2007, A New Story Foundation, Inc.
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S&P Futures - price
• If not already peaked, look for a market top in the first week.
• The market should decline most of the month into August.
July 2007 Market Bias Forecast. Copyright 2007, A New Story Foundation, Inc.
% Price Change, Cumulative - July 2007
-8
-7
-6
-5
-4
-3
-2
-1
0
2 9 16 23 30 3-Aug
S&P 500 Forecast 1 New Method
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Stock Market Cycles - “O” Model
• Alternate, independent method shows observed cycles in the S&P indicating trend turn down in July (the two trend lines peak July 18th).
July 2007 Market Bias Forecast. Copyright 2007, A New Story Foundation, Inc.
S&P Cycles July 2007
-1.000
-0.800
-0.600
-0.400
-0.200
0.000
0.200
0.400
0.600
0.800
1.000
7/2/2007 7/9/2007 7/16/2007 7/23/2007 7/30/2007
Trend 1 Trend 2 Timing 1 Timing 2
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“O” Model Composite
• Note: The “O” Model forecast indicates timing and direction, but not degree.
July 2007 Market Bias Forecast. Copyright 2007, A New Story Foundation, Inc.
S&P Cycles July 2007- composite
-0.400
-0.200
0.000
0.200
0.400
0.600
0.800
7/2/2007 7/9/2007 7/16/2007 7/23/2007 7/30/2007
Week beginning
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S&P Futures - range
Current contract expected high 1545, low 1440, close 1450, with a net loss of 4.4% for the month.
S&P Futures Range - July 2007
1380
1400
1420
1440
1460
1480
1500
1520
1540
1560
Forecast
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U.S. Dollar Index
• Bullish perspective for June:“… but it’s oversold.”
• Bearish perspective for June:“Sell every rally.”
• Overall strength of change is mildly bearish: -2 (out of max -5)
July 2007 Market Bias Forecast. Copyright 2007, A New Story Foundation, Inc.
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Dollar Index - price
• The two forecast versions were divergent– a median is also given for the $.
• Primary difference is depth of drop in 2nd week.
June 2007 Market Bias Forecast. Copyright 2007, A New Story Foundation, Inc.
% Price Change, Cumulative - July 2007
-1.5
-1
-0.5
0
0.5
1
2 9 16 23 30 3-Aug
US Dollar Forecast 1 New Method Median
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Dollar Index - range
Current contract expected high 82.5, low 81, close 81.4 for a net loss of 0.4%.
Dollar Index Range - July 2007
80.00
80.50
81.00
81.50
82.00
82.50
Forecast
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July 2007 Market Bias Forecast. Copyright 2007, A New Story Foundation, Inc.
Market Bias Summary - volatility
This composite shows large changes in the dollar the 1st and 2nd week, and Crude between 1st and 3rd weeks.
Rate of Price Change - July 2007
-0.8
-0.6
-0.4
-0.2
0.0
0.2
0.4
0.6
0.8
2-6 9-13 16-20 23-27 30 - Aug 3 Next Month
Crude Oil Dollar Stocks
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Disclaimer
The reliability of the forecasts corresponds with our current ability to reliably ascertain and score the collective mood of bullish and bearish investors for each time period under review.
A New Story Foundation is not a brokerage firm nor are we professional investment advisors. Please consult the appropriate person/firm for specific investment advice.
More information about our research can be found on our website at http://www.anewstory.org.
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Thanks for your interest!