Good Evening, We are still in the process of moving into a new home so our internet has been a little disrupted to say the least. Prayerfully this situation will start to get better although there is still a lot of work to do before the place will be completed. I covet your prayers! I am probably more anxious to get back to a regular schedule than you are for me to do so. What can I say. God’s still on the throne and life goes on. So….speaking of what’s going on, there seems to be a new crisis to replace the old crisis which was the trade war. Unless you are living on an uncharted isolated island with no communication you should be aware of the conflict with Iran that started last week when the US targeted and successfully eliminated Iranian General Qassim Soleimani in a drone attack. Of course Iran is threatening to retaliate and the US says you better not or else which leaves the market to ponder the issue of whether or not the conflict will grow. At this point most analysts would make a bold prediction about where this new crisis will take the market. That would be little more than a guess. As you all very well know I am a reactive trader. I try real hard not to base my investment decisions on predictions. So what is the here and now that our charts are telling us? They are telling us that the market has survived the stress test so far and awaits the upcoming earnings season. The S&P 500 only dropped -0.38% Friday after the initial news report of the drone attack. That’s hardly even a bad day in an overbought market like this one. But can’t that change? You bet it can. Another drone strike or missile attack and the the market will probably sell off. By the matter of fact the futures are off right now in due to an Iranian Missile attack this evening. All that said, the chart for the S&P 500 is still throwing up a buy signal. By the matter of fact all three of our equity based funds are still trading above their 20 EMA’s. You can check that out below. Selling right now would be jumping the gun and I don’t recommend doing it unless your time frame is very short. Sure, we can sell in anticipation of the conflict getting worse. We sold a couple times last year when we though the China trade deal was caving in and it worked out in the short term. However, our time horizon was longer, much longer than that. It was intermediate to long term and when the market popped right back we left money on the table. I will say this, our goal is capital preservation and in that we were successful. We had a decent year and I thank God for that. Nonetheless, I do not intend to sell until my charts say to sell and right now they indicate that this is more than likely a buying opportunity. The VIX our measure of fear is only 13.79. I don’t even consider it to be elevated until it is over 16. How about the ratio of stocks to bonds? My chart of the SPY(stocks) compared to the TLT (Long tern treasuries) is moving straight up. It has even formed a bullish wedge formation predicting that it will go higher. Those are just a few examples of indicators that I watch. The bottom line is that right now they don’t say to sell. When they do I’ll sell and you’ll be the first to know. I have to say that at this moment given the greater weight of the charts I must still consider this a buying opportunity.
The days trading left us with the following results: Our TSP allotment slipped to the tune of -0.28%. For comparison, the Dow fell -0.42%, the Nasdaq -0.03%, and the S&P 500 -0.28%.
The days action left us with the following signals: C-Buy, S-Neutral, I-Neutral, F-Neutral. We are currently invested at 100/C. Our allocation is now +0.23% for the year. Here are the latest posted results:
| 01/07/20 | Prior Prices | ||||
| Fund | G Fund | F Fund | C Fund | S Fund | I Fund |
| Price | 16.3565 | 19.7797 | 47.369 | 56.3446 | 32.7096 |
| $ Change | 0.0009 | -0.0183 | -0.1283 | -0.0860 | 0.0749 |
| % Change day | +0.01% | -0.09% | -0.27% | -0.15% | +0.23% |
| % Change week | +0.02% | -0.22% | +0.08% | +0.07% | -0.29% |
| % Change month | +0.04% | +0.31% | +0.23% | +0.12% | -0.02% |
| % Change year | +0.04% | +0.32% | +0.23% | +0.12% | -0.02% |
| L INC | L 2020 | L 2030 | L 2040 | L 2050 | |
| Price | 21.2013 | 29.3321 | 34.8914 | 38.4763 | 22.5123 |
| $ Change | -0.0040 | -0.0064 | -0.0183 | -0.0240 | -0.0158 |
| % Change day | -0.02% | -0.02% | -0.05% | -0.06% | -0.07% |
| % Change week | -0.01% | -0.01% | -0.04% | -0.05% | -0.06% |
| % Change month | +0.07% | +0.08% | +0.11% | +0.12% | +0.13% |
| % Change year | +0.07% | +0.08% | +0.11% | +0.12% | +0.13% |
I have nothing to add here. I’m sure that 2020 is going to be an interesting year. At least is sure starting out that way. Pray that God will guide our investment group throughout this new year and pray for our country, that we might have rest from our enemies round bout, that God will continue to protect us, and most of all that His peace will fall upon the House and Senate. May He guide them in their service to this great nation! Have a nice evening and may God continue to bless your trades!
