One thing we talk about in our Investment Survival Workshops is learning to develop a horizon further out than tomorrow. I know that sounds obvious but it’s harder to do than you think. Most people including myself, hesitate for a moment to recall what they did yesterday and most of us wake up and think about what we are going to do that day, not the next day or the following week. When I moved from Eastern Standard time to Mountain Standard time zone, I dreaded getting up two hours earlier in the predawn to read the papers and analyst reports. I soon came to the conclusion, though, that if you are worrying about what’s going to happen today, you’re too late already- no matter how early you get up. What’s going to happen today has for the most part been determined in Europe already or prior to that in the Asian markets. No, you need to be worrying about what’s going to happen tomorrow or the following Thursday or some time in the future. With that in mind, I’m worrying about what’s going to happen Wednesday.
1. Apple launch of the new iPhone. Apple will have to hit the ball out of the court . That’s something they have not done since Jobs died. Sales are good and the products shine compared to the competition with one big exception. The hardware, feel, and sex appeal of the new Samsung Galaxy III are greatly superior to the dated series of iPhones now. In fact if Apple doesn’t top it, Galaxy III may be my next smartphone. Apple now represents 5% of the S&p 500 by weighting. It can drag down the index and crush the NASDAQ.
2. Germany’s constitutional court is due to rule on Sept. 12 on whether the euro zone can launch its permanent bailout fund. It will be very bad for the market if they turn this down. This is a real distinct possibility considering that the German press has been slamming Merkel about the recent ECB decision to support Eurozone member bonds in the aftermarket.
The market is deeply overbought to begin with so I think traders should be leery come Tuesday. Wednesday might be a pivotal day. Longer term investors of course won’t be bothered with this noise. They don’t mind watching their portfolios decline 5%. Unfortunately fewer and fewer of those investor are left playing.