Good Evening,
We had a mixed day today, but I’m not surprised. I expect to have many of them this year…..Other than some disappointing corporate results I found the economic news to be encouraging.
Stocks end mixed on bad corporate news
The day’s lazy action left us with the following signals: C-Neutral, S-Buy, I-Buy, F-Buy. Our current allocation is 42/C, 58/S. I plan to re-balance the allocation between the 20th and 25th of the month. Our allocation has gained +0.61% in 2014. Here are the latest posted results:
| 01/15/14 | |||||
| Fund | G Fund | F Fund | C Fund | S Fund | I Fund |
| Price | 14.3016 | 15.8461 | 23.8915 | 34.0065 | 25.572 |
| $ Change | 0.0010 | -0.0095 | 0.1233 | 0.1776 | 0.1245 |
| % Change day | +0.01% | -0.06% | +0.52% | +0.52% | +0.49% |
| % Change week | +0.03% | -0.11% | +0.34% | +0.54% | +0.31% |
| % Change month | +0.10% | +0.66% | +0.07% | +1.00% | +0.03% |
| % Change year | +0.10% | +0.66% | +0.07% | +1.00% | +0.03% |
| L INC | L 2020 | L 2030 | L 2040 | L 2050 | |
| Price | 16.8428 | 21.8383 | 23.5138 | 24.9009 | 14.103 |
| $ Change | 0.0177 | 0.0580 | 0.0792 | 0.0962 | 0.0615 |
| % Change day | +0.11% | +0.27% | +0.34% | +0.39% | +0.44% |
| % Change week | +0.09% | +0.20% | +0.25% | +0.28% | +0.32% |
| % Change month | +0.16% | +0.20% | +0.23% | +0.27% | +0.28% |
| % Change year | +0.16% | +0.20% | +0.23% | +0.27% | +0.28% |
As you can see from yesterday’s chart from decisionpoint.com, the C-Fund is bumping off of resistance. Today’s choppy action is a result of that and we’ll likely see more of the same until a top is formed and a major pullback occurs.
The SPX broke above the short-term declining tops line (see thumbnail chart), but it would seem as if resistance from the December top stopped its progress. My opinion is that the real resistance will prove to be the top of the rising wedge pattern.
The big question is not if but when? I have said many times that I believe that the key to knowing when lies with the FED’s quantitative easing program. My belief is that as long as the money flows into bonds, the market will continue to bump off of it’s highs occasionally making a decent run here and there until the money is removed which will allow the top to form. Then it’ll be Katy Bar the Door! That’s the most likely scenario of how this thing will play out. Our job will be to monitor our charts and try to get whatever profit the market gives us and then to retreat to a defensive position with most of our gains in tact when it is over. If forced to make a guesstimate on when this will take place, I would say at or near the end of 2014. Barring any disasters, that’s probably when most of the QE will be gone. Nevertheless, we will play whatever action is put before us at the time that it occurs. May God continue to bless your trades. Have a nice evening!
Scott
