Good Evening,
The Dow and S&P ended the day slightly off. Our thrift funds came in mixed, with the C and S funds posting small losses while the I and F funds posted small gains. We did manage a slight gain again on the street, but it was tough to get! On the surface it looked mild, but if you followed the market all day then you probably got a bit concerned in the morning as the Dow had a sizable drop in the early going. It seems that one of the FED officials mentioned something about interest rates rising in early 2015. Remember what I said about the big correction likely coming when the FED raises rates? If a rumor of a rate increase next year can cause a 100 point drop in the Dow now, just think what it will do when it actually comes! At least now we know for sure what we need to look for. I, for one, plan on sitting on a lot of cash when that day comes. You can call it TOP Calling if you want. I fully intend to duck and run and this is just a solid conformation of why I will do it. When the rates go up, everything else is gonna go down. And yes, that means bonds too!!! However, we are safe for now so we need to focus on trying to get what this market has left to give…. The RevShark had some interesting comments on how the market keeps going up, but does so on very little confidence.
James DePorre “RevShark”
“These days it seems that both bulls and bears are rooting for some sort of market rest. The bears for obvious reasons and the bulls because they never can seem to produce good relative performance. Once again active fund managers are badly lagging their benchmark indices. They had one of their worst years of underperformance in 2013. 2014 has been quite challenging as well especially after the ‘stealth’ correction that took place in momentum and small cap stocks in March and April.The dilemma of this market is that it is generally good action but it’s slow and boring. We did have a little excitement in the first 30 minutes of trading when it looks like the computer programs took us straight down but after that it was the slow drift higher the rest of the day just like on Wednesday. There is no question it is positive action but if you are looking for excitement there isn’t much.This action results in positive sentiment but as I said this morning it is a mile wide and an inch deep. Folks stay bullish out of fear of being left out rather than due to a high level of conviction about positive fundamentals or other conditions. At some point that is going to be an issue but for now it creates a dynamic that keeps pushing us higher.”
It may not have been a win, but Wall Street has something to celebrate today — just like USA soccer.
The day’s action left us with the following signals: C-Buy, S-Buy, I-Neutral, F-Neutral. We are currently invested at 25/C, 75/S. Our allocation is now -3.00% on the year. Here are the latest posted results:
| 06/25/14 | |||||
| Fund | G Fund | F Fund | C Fund | S Fund | I Fund |
| Price | 14.4496 | 16.3814 | 25.5724 | 35.4603 | 26.739 |
| $ Change | 0.0009 | 0.0217 | 0.1248 | 0.2418 | -0.1595 |
| % Change day | +0.01% | +0.13% | +0.49% | +0.69% | -0.59% |
| % Change week | +0.03% | +0.30% | -0.16% | -0.35% | -0.95% |
| % Change month | +0.16% | -0.15% | +2.00% | +3.57% | +0.54% |
| % Change year | +1.14% | +4.06% | +7.11% | +5.32% | +4.59% |
| L INC | L 2020 | L 2030 | L 2040 | L 2050 | |
| Price | 17.2141 | 22.6548 | 24.5518 | 26.1106 | 14.8455 |
| $ Change | 0.0107 | 0.0253 | 0.0364 | 0.0468 | 0.0275 |
| % Change day | +0.06% | +0.11% | +0.15% | +0.18% | +0.19% |
| % Change week | -0.04% | -0.19% | -0.26% | -0.30% | -0.36% |
| % Change month | +0.48% | +1.01% | +1.28% | +1.49% | +1.65% |
| % Change year | +2.36% | +3.94% | +4.66% | +5.14% | +5.56% |
Price is back within the bearish ascending wedge. The market has found an area of resistance along the top of the wedge and the PMO is now one-thousandth of a point away from a negative crossover in overbought territory.
Conclusion:“Price is back inside the bearish rising wedge. Short-term indicators are now neutral and falling. Intermediate-term indicators have all had negative crossovers and are headed lower. Downward pressure and momentum are keeping price from breaking out decisively and will likely hold price down longer. “
