Good Evening,

The day started off in the negative with a lot of overseas turmoil to boot. However, despite it all, the dip buyers were finally able to reverse the selling and mount the rally that we’ve all been expecting. Unlike the past two failed bounce attempts, there was no selling into the strength with the major indices closing out near their highs of the day. The question that must be answered now: Is this the beginning of a new rally after another dip of less than 10%? Technically I must call it a dip since a correction is 10% or more. Although I have noticed that many commentators have taken to calling dips over 3% corrections. I guess that is because it has been two years since we have had a correction that is greater than 10%. Well, the jury is still out on this one. We’ll just have to watch the charts and see where they go. Both the TSP and AMP programs managed slim gains on the day which was good considering that we are in a defensive posture and the S&P rallied over 1%. The gain for the AMP program was the fourth daily gain in a row which is very consistent in such a volatile market. 

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NEW YORK (CNNMoney)

What global turmoil? U.S. stocks up 1%

 

 

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The week’s action left us with the following signals: C-Sell, S-Sell, I-Sell, F-Buy. We are currently invested at 25/G, 75/F. Our allocation is now -6.05% on the year not including today’s results. Here are the latest posted results:

08/07/14
Fund	G Fund	F Fund	C Fund	S Fund	I Fund
Price	14.4882	16.4813	24.9785	34.0538	25.6746
$ Change	0.0009	0.0359	-0.1334	-0.1549	-0.1080
% Change day	+0.01%	+0.22%	-0.53%	-0.45%	-0.42%
% Change week	+0.04%	+0.31%	-0.74%	-0.17%	-1.77%
% Change month	+0.04%	+0.50%	-1.03%	-0.41%	-2.51%
% Change year	+1.41%	+4.70%	+4.62%	+1.14%	+0.43%
	L INC	L 2020	L 2030	L 2040	L 2050
Price	17.1513	22.3279	24.0739	25.509	14.4496
$ Change	-0.0138	-0.0527	-0.0738	-0.0907	-0.0589
% Change day	-0.08%	-0.24%	-0.31%	-0.35%	-0.41%
% Change week	-0.14%	-0.46%	-0.59%	-0.67%	-0.78%
% Change month	-0.20%	-0.66%	-0.85%	-0.96%	-1.13%
% Change year	+1.99%	+2.44%	+2.62%	+2.72%	+2.75%

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Here’s what the C Fund looked like courtesy of Stockcharts.com.

With today’s strong turn around the C Fund managed to close back above its 100 EMA. The 5 EMA shows signs of bottoming which is promising for the bulls. Volume was average with the PMO starting to turn up. It still has some work to do, but that’s a step in the right direction. The chart remains in a sell signal and short term downward trend. Price needs to return to the 1950 area  to repair most of the damage that has been done by this sell off.

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For the time being, we should still consider the market in a short term down trend and possible correction until some of the indicators improve. We’ll be watching closely to see if the PMO can turn back up and make a positive crossover. It is currently in neutral to slightly oversold territory, but it could support a decent rally from this point. It would be ideal to see it retreat further into oversold territory before it turns up. The more it retreats the better rally it will support on the way up. Also, that would allow us the most time to find a good entry point as we get back into equities.  For now, we’ll keep a close eye on the charts to watch for the above noted changes. Perhaps I’ll break my personal chart out for the next message. I use the MAC D Histogram and the Williams percent R in addition to the above indicators. Stacking them together really gives you a really good picture of what’s going on with that particular chart. That’s all for this week. I thank God for his protection of our portfolios during this down trend. May He continue to bless your trades! Have a nice weekend and I’ll see you on Monday.

God bless,

Scott