Good Evening, It was a bad day for the bulls as the market sold off on concerns about rising bond yields. It was a particularly bad day for big cap stocks as they started catching up to small cap stocks on the way down. In my last blog we talked about the fact that big cap and small cap stocks would not move in opposite directions for long and today was exactly what we were talking about. I certainly wish it was small caps catching large caps on the way up rather than large caps accelerating their slide to catch small caps on the way down. Nonetheless, we did mention that scenario. As usual the question is where do we go from here? There is no doubt some technical damage was done today and that the upper trend is coming under some pressure. Fundamentally our case for remaining in the market remains in place and there is reason to be optimistic heading into the new year. However, what the fundamentals say and what we think aren’t always what takes place. That is the reason we watch the charts. They tell us what is actually happening not what should be happening. That said, our plan remains the same and that is to stay in the market if at all possible until seasonality becomes our tailwind. Should the chart for the S fund generate and overall sell signal we will move to the safety of the G Fund and await a new buy signal in one of our equity based funds moving into the new year. I don’t anticipate that happening but sometimes these things just simply surprise you.
The days trading left us with the following results: Our TSP allotment gave up -1.39%. For comparison, the Dow fell -0.75%, the Nasdaq -1.81%, and the S&P 500 -0.82%. There was blood in the streets. One positive thing I will say is that the indices moved off their lows during the last hour of the trading session. So does that indicate a bounce tomorrow? We will see.
The days action left us with the following signals: C-Neutral, S-Neutral, I-Sell, F-Sell. We are currently invested at 100/S. Our allocation is now +8.85% on the year not including the days results. Here are the latest posted results:
| 10/03/18 | Prior Prices | ||||
| Fund | G Fund | F Fund | C Fund | S Fund | I Fund |
| Price | 15.874 | 17.7524 | 41.7382 | 53.198 | 30.2779 |
| $ Change | 0.0013 | -0.0983 | 0.0287 | 0.3271 | -0.0564 |
| % Change day | +0.01% | -0.55% | +0.07% | +0.62% | -0.19% |
| % Change week | +0.02% | -0.53% | +0.39% | -0.98% | -0.82% |
| % Change month | +0.02% | -0.53% | +0.39% | -0.98% | -0.82% |
| % Change year | +2.15% | -2.00% | +10.98% | +9.76% | -1.87% |
| L INC | L 2020 | L 2030 | L 2040 | L 2050 | |
| Price | 20.1201 | 27.8184 | 32.2148 | 35.2584 | 20.5173 |
| $ Change | -0.0027 | -0.0023 | 0.0034 | 0.0069 | 0.0069 |
| % Change day | -0.01% | -0.01% | +0.01% | +0.02% | +0.03% |
| % Change week | -0.05% | -0.07% | -0.14% | -0.17% | -0.20% |
| % Change month | -0.05% | -0.07% | -0.14% | -0.17% | -0.20% |
| % Change year | +2.91% | +3.45% | +4.81% | +5.32% | +5.78% |
