Good Evening, The pressure from Friday continued today with stocks selling off in the morning session. However, investors were able to regroup in the afternoon and drive the Dow and S&P 500 back up to around the even mark. Small caps on the other hand were unable to fully recover from the morning sell off. There is no doubt that most of the charts I am looking at are under pressure with many of them close to sell signals. That noted, the market is primed for a strong bounce if not a reversal. I just don’t think the funds that are currently under pressure such as the IWM, the QQQ or the VXF to name a few will end up generating sell signals. While they are indeed close to sell signals, it is more likely that they will drift sideways to a little lower while the large cap indices such as the Dow and S&P 500 catch with them. Remember that large caps and small caps never stay separated for long. Eventually they equal out and given the current situation it sure looks like big caps have some more selling to do. It is unlikely that small caps will rebound to join them were they are currently at. That’s just not they way it normally works. They usually rebound together. We will see. The same issues continue to effect the market, trade and bonds. The trade issue is simple, it is now primarily between the U.S. and China. The bond issue is more complex. Such things as bond yields and interest rates come into play. You can research that for yourselves but the bottom line is that trouble in the  bond market puts downward pressure on the stock market for several reasons. Of course there is the old adage that when bonds are low stocks are high, but that only works for a certain amount of time until stocks are affected in a negative way. Some folks say it’s simple but I think it’s a little more on on the complicated side for your average home gamer. You’ll have to study and decide for yourselves!

The days trading left us with the following signals: Our TSP allotment was off -0.45%. For comparison, Dow added +0.15%, the Nasdaq dropped -0.67%, and the S&P 500 was flat at -0.04%.

Dow Rebounds to End Higher Monday

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 +6.39% on the year not including the days results. Here are the latest posted results:

God bless, Scott 

 

 ***Just a reminder that you can review the performance of our allocation at the Web Site TSPTALK.com in the autotracker section under the screen name KyFan1.

 

 

I produce and publish this blog as both a ministry and for the benefit of any Federal Government Employee. This is done to offer you some guidance as to how to approach your retirement more financially successful. When it is time for you to retire, I recommend you utilize the services of a Professional Money Manager, who works with a reputable investment firm. He understands the guidance you have already received and he can manage your savings assets utilizing a more advanced investment program into the future. 

 

If you would like to receive more information about this introduction, please feel free to contact me at  KyFan1@aol.com.