Good Evening, We gambled and stayed in the market Friday (at least those of us who didn’t forget to cancel our itnerfund transfers LOL) and have been rewarded with another modest gain. The market and small caps in particular are showing signs of bottoming. Small caps were the first to fall and they will be the first to bottom. Tomorrow is the official start of earnings season. That is the reason that we paid such a heavy price to remain in the market until now. It is my belief that earnings are what is ultimately going to move this market higher. We still have the same old drags of trade, treasury bonds, and interest rates but we have ignored the sell signal that they generated because the tax cut fueled earnings should be good enough to move us higher. Our biggest concern is the guidance issued during these reports. If enough companies guide down citing the Fed and/or trade, any advantage that we gain from good earnings will most surely be lost. Like I said above, we gambled. We gambled based on fundamentals. As those of you who have been with me from the start know, I am primarily a technical analyst. If I had to put a number on it I would say 90% technical analysis and 10% Fundamental analysis. Yes, I can be successful using only technical analysis. However, I have learned not to ignore fundamental analysis when it makes a  strong case and I think this is a strong case. The economy is good, companies are making nice profits and those profits have been boosted by current tax cuts, unemployment is at record lows, inflation is still low, interest rates are still historically low, and October, November, and December are historically the three best months for the market. Oh yes, also not to be overlooked. the market is very oversold. It is due for a bounce. So why not hang on a few days to see if we get one? After all there’s a pretty good chance of a nice reward. Sometimes you just have to take a chance and this is one of those times…..

The days trading left us with the following results. Our TSP allotment posted modest gain of +0.23%. For comparison, the Dow lost -0.35%, the Nasdaq -0.88%, and the S&P 500 -0.59%. Praise God for our small gain! At least for today, our decision Friday to stay in the market was a good one.

The days action left us with the following signals: C-Neutral, S-Sell, I-Sell, F-Neutral. We are currently invested at 100/S. Our allocation is now +1.06% on the year. Don’t forget that my allocation spent an unintended day in the G Fund. Your return will be better. My allocation will be back at 100/S in the morning. 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.