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Goldata Financial
Dedicated to above average returns in the stock market.
STOCK MARKET COMMENTARY
January 5, 2009
From Elliot Goldberg,
Registered Investment Advisor, Goldata Financial
Last week, the script laid out two weeks ago (commentary-2008-12-22.htm) came to
fruition proving, once again, that a broken clock can be right twice a day.
The fundamental news continued to be terrible, but the only news that moved
the market significantly downward was S&P's decision to place General
Electric (GE) under review for potential credit downgrade, something it was
not expecting. By Friday, our overhead resistance level of SPY92 was
breached, but given that it was done during holiday trading, victory cannot
yet be declared. Volatility continued to come in (under 40 now and closing in
on historical norms), but, more importantly, the sell off in Treasuries and
the buying of riskier bonds (resulting in higher prices) signals that the
long-awaited thaw in credit appears to be underway and, by Friday, was
accelerating. The headlines continue to scream: "Watch out!" but as
investors, we must keep in mind the words of hockey legend Wayne Gretzky
"I skate to where the puck is going to be, not where it
has been." And so we must try to discern between the fear we feel
currently and where the economy "is going to be" with Mr. Market's
actions starting to tell us that economy is going to be better in the near
future than previously thought. The crowd will be back this coming week and
the bears should put up a fight defending SPY92. If the bulls win this fight,
SPY100 should be the next level of contention. Positions will continue to be
accumulated as more and more equities move across their 200-day moving
averages (which are moving down rapidly). Stops will be given some room, as
risk/reward gives the advantage to the bulls.
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Goldata Financial manages personal, corporate and
retirement assets that are dedicated to investment in the equity market using
its strategy of combining fundamental and technical analysis that is designed
to limit losses and let winners run. Goldata Financial is compensated
solely by a performance fee, which is based on the increased value of a
portfolio over time. Additional details can be viewed online at www.goldata.com or by calling Elliot
Goldberg directly at (610) 896-9440. The annualized, dollar weighted return
for the short-term trading strategy is –5.71% versus –16.98% for a comparable
investment in the S&P 500 through December 31, 2008.
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