Good Evening, We managed to have another good day. What is that? Three or Four in a row? I lost count. Amazing for August. That’s what I say! The media is crediting positive trade sentiment, but I’m not so sure. The market usually trades well ahead of holidays. There are two reasons for that. Traders that are still at their desks trading are in a jovial mood due to the upcoming holiday and volume is always light. That normally makes for some real good trading. My favorite time for this phenomena is the week before Christmas. They even have a name for that one. They call it the Santa Clause rally. Works for me! One other thing that I noticed today was that a lot of folks both in and out of the media were comparing the recent trading to the trading this past January. They were using the same term to describe it “melt up”. I think the idea is supposed to be that there will be a crash at the end. There is no denying that the action in January ended with a crash in February. However, there is one huge difference. Many investors were invested in what are often called volatility instruments. They are Exchange Traded Funds (ETF’s) that are designed to bet against the VIX Volatility Index. In other words they were betting that the market would remain calm or that there would be no big moves up or down. They had become complacent with the trading in 2017 in which there were no dips of greater than five percent. Well you know the rest of the story. Market volatility increased and those trades unwound in a hurry forcing a lot of big investors to sell those positions as losses mounted. The market was like a snowball rolling downhill. I wondered at the time why the SEC even allows the trading of such instruments in which the investor doesn’t even own any actual securities. I said if at the time and I’ll say it again. It was no more than legal gambling and in this case the gamblers were forced to over there bets! Anyway, that’s not the case now. The market has been more volatile since then and I don’t think they’ll be stupid enough to do that again. Will they?????? Folks, I’m not saying the market will not take rest or undergo a reasonable correction. I’m saying that I don’t think it will crash. I’m staying invested. You have to be in it to win it and right now we’re winning. I praise God for that!!!!
The days trading left us with the following results: Our TSP allotment added +0.30%. For comparison, the Dow gained +0.23%, the Nasdaq +0.99%, and the S&P 500 +0.57%. Looks like they may be starting to favor big caps with trade deals pending. We’ll have to keep a close eye on that. The dollar has been sliding lately which is probably adding to this trend. I don’t think that will continue though.
The days action left us with the following signals: C-Buy, S-Buy, I-Neutral, F-Neutral. We are currently invested at 100/S. Our allocation is now +11.46% on the year not including the day’s results. Here are the latest posted results:
| 08/28/18 | Prior Prices | ||||
| Fund | G Fund | F Fund | C Fund | S Fund | I Fund |
| Price | 15.8284 | 17.9351 | 41.2674 | 54.4718 | 30.5589 |
| $ Change | 0.0013 | -0.0307 | 0.0115 | 0.0428 | 0.0937 |
| % Change day | +0.01% | -0.17% | +0.03% | +0.08% | +0.31% |
| % Change week | +0.03% | -0.25% | +0.81% | +0.50% | +1.30% |
| % Change month | +0.23% | +0.54% | +3.08% | +4.16% | -0.92% |
| % Change year | +1.85% | -0.99% | +9.72% | +12.39% | -0.96% |
| L INC | L 2020 | L 2030 | L 2040 | L 2050 | |
| Price | 20.0874 | 27.7831 | 32.2074 | 35.2721 | 20.5367 |
| $ Change | 0.0040 | 0.0090 | 0.0205 | 0.0268 | 0.0182 |
| % Change day | +0.02% | +0.03% | +0.06% | +0.08% | +0.09% |
| % Change week | +0.19% | +0.30% | +0.54% | +0.64% | +0.73% |
| % Change month | +0.61% | +0.83% | +1.35% | +1.56% | +1.75% |
| % Change year | +2.75% | +3.32% | +4.79% | +5.36% | +5.88% |
