Good Evening,
Stocks were down again and precious metals and oil were slaughtered. This is not like the four previous pull backs that we experienced this year. This time small caps did not lead the way and the catalyst was dropping oil. No, let’s call it plummeting oil! I would think that there would be some positive in addition to the negative fallout from the oil market, but at least for right now, it’s all negative. I’m not really sure what’s up with the precious metals market. The strong move down just seems to go with the general pessimism of today’s action. It’s possible that it was just a good bout of profit taking as precious metals were up strongly in the past month. Another play would be currency, the dollar was up slightly today, but has been down in recent sessions. Today’s gain in the dollar really wasn’t enough to make metals drop as much as they did. Could this simply be a signal for another run in the greenback? After all, a strong dollar puts downward pressure on the metals market. Maybe investing a little more in the dollar might be in order for some of you that would be so inclined. The fund I like to use when I invest in the dollar is the UUP. All that said, the drop in precious metals could just be a rotation out of the sector and back into stocks for the Santa Rally. I really don’t know where it fits in just yet. I’ll just have to do a little research and figure it out! Either way the action in the coming days will tell us the story. As a result of today’s poor action our TSP allocation dropped another -0.68% and AMP slipped back -0.65%. We could sure use a nice bounce tomorrow!
Wall Street dips in volatile trade; oil prices fall further
The day’s action left us with the following signals: C-Sell, S-Sell, I-Sell, and F-Buy. As of the close of business today, we will be invested at 80/G, 20/S. As you can see, the S fund also generated a sell signal today. So why didn’t I sell the S Fund? The sell signal occurred later in the day after the 12:00 PM interfund transfer request deadline. Barring a bounce tomorrow we will make another interfund transfer to sell the S Fund and move that 20% to the G. I would have transferred all or most of the allocation to the F fund, as bonds are doing well, but cannot to do so as I have already used my allotted two trades for the month and by thrift rules can only move to the G Fund where I will be stuck until the first of the year. That’s the price of protecting your capital in TSP! Just a reminder that those restrictions do not exist outside of Thrift! (Which is a good reason to get out of that system when you can.)
Our allocation is now -3.16% for the year not including today’s results. The month is not over, but barring a miracle, which I might add God is capable of, our allocation will suffer its worst yearly return since its inception in 1998! The worst up to this date was -1.87% in 2011. We’ll see what happens. It’s gonna take a strong market for 80/G, 20/S. to get us out of this one! All I can say at this point is good riddance to 2014. It can’t be over soon enough and I don’t know of a Fund Manager out there that doesn’t fully concur! Here are the latest posted results:
| 12/12/14 | |||||
| Fund | G Fund | F Fund | C Fund | S Fund | I Fund |
| Price | 14.6013 | 16.8034 | 26.3973 | 34.8823 | 24.1017 |
| $ Change | 0.0008 | 0.0478 | -0.4342 | -0.4582 | -0.4413 |
| % Change day | +0.01% | +0.29% | -1.62% | -1.30% | -1.80% |
| % Change week | +0.04% | +0.73% | -3.47% | -3.07% | -4.20% |
| % Change month | +0.08% | +0.22% | -3.07% | -2.94% | -4.59% |
| % Change year | +2.20% | +6.75% | +10.56% | +3.60% | -5.72% |
| L INC | L 2020 | L 2030 | L 2040 | L 2050 | |
| Price | 17.3494 | 22.6106 | 24.4076 | 25.8869 | 14.6505 |
| $ Change | -0.0526 | -0.1849 | -0.2569 | -0.3133 | -0.2025 |
| % Change day | -0.30% | -0.81% | -1.04% | -1.20% | -1.36% |
| % Change week | -0.65% | -1.81% | -2.33% | -2.68% | -3.07% |
| % Change month | -0.62% | -1.75% | -2.27% | -2.61% | -2.98% |
| % Change year | +3.17% | +3.74% | +4.04% | +4.24% | +4.17% |
Not much to add here. We have been watching this chart for several days. As we discussed, it generated a sell signal today when its 5 EMA crossed down through its 50 EMA. We’ll see how the use of this set of soft indicators plays out this time, but right now I’m inclined to think that it’s probably time to switch back to our hard (quicker) set of indicators. At least up to this point they would have preserved more capital and that’s the name of the game!
