09/03/14

Good Evening,

My, what a difference a day makes. It seems like we’ve been saying that a bunch lately!  The Dow and the S&P were flat. Actually, our TSP allotment posted a small loss. However, the defensive AMP allocation regained some of the ground it lost yesterday as most defensive investments had a nice day. That’s two days of mild weakness in the overall market. Highlighting the struggle within, is the fact that one day was terrible for defensive investments and one day was good. There are a lot of factors involved in that. Most notably the ECB meeting on Thursday which may bring quantitative easing to Europe. With out getting too technical, that stimulus would could make both stocks and bonds in Europe more attractive to foreign investors that are currently invested in the US because quite frankly there is no place else to go. The net result would be funds flowing out of US stocks and bonds and back into Europe. There is one play on this, however: such action will strengthen the Euro which has strongly contributed to a rising Dollar as it (the Euro) weakened in recent months. Also, contributing to a weaker dollar to a lesser extent would be a strengthening ruble. The ruble rose 5% against the dollar today on the news that Russia and Ukraine have reached an agreement that will lead to a lasting cease fire in that troublesome (both for the market and for the world) conflict, but we’ll hold the phone on that one. Anyway, getting back on track, the play would be precious metals in particular gold which will strengthen as the dollar weakens. There’s always a place to go and with a little work and God’s guidance it can be found… The picture should be clearer by tomorrow afternoon. I am still expecting a market pullback/correction some time in the next 6 weeks and will be surprised if one doesn’t come. We’ll watch and see what happens on the charts and make adjustments accordingly. 

Tech Sector Weighs on Stocks

The day’s action left us with the following signals: C-Buy, S-Buy, I-Buy, F-Buy. Yes, that’s right, as I said a day or so ago– everything’s working right now. It’s one of those rare times and it probably won’t last long. We are currently invested at 40/C, 60/S. Our allocation is now -2.89% not including today’s results. Here are the latest posted results:
09/02/14
Fund G Fund F Fund C Fund S Fund I Fund
Price 14.5128 16.5312 26.2361 36.0285 26.2822
$ Change 0.0019 -0.0512 -0.0130 0.1298 -0.0140
% Change day +0.01% -0.31% -0.05% +0.36% -0.05%
% Change week +0.01% -0.31% -0.05% +0.36% -0.05%
% Change month +0.01% -0.31% -0.05% +0.36% -0.05%
% Change year +1.58% +5.02% +9.89% +7.00% +2.81%
  L INC L 2020 L 2030 L 2040 L 2050
Price 17.3275 22.8447 24.7842 26.3786 14.9995
$ Change -0.0012 -0.0004 0.0011 0.0038 0.0033
% Change day -0.01% +0.00% +0.00% +0.01% +0.02%
% Change week -0.01% +0.00% +0.00% +0.01% +0.02%
% Change month -0.01% +0.00% +0.00% +0.01% +0.02%
% Change year +3.04% +4.81% +5.65% +6.22% +6.66%
Lets take a look at the I Fund today. Chart courtesy of Stockcharts.com
As you can see the I Fund clearly dominated the other TSP funds today. This was largely due to the surge in European markets expecting positive news tomorrow when the ECB releases it’s statement and to a possible cease fire agreement in Ukraine which has been a big drag on European markets for some time. If tomorrows ECB meeting goes as anticipated the I Fund may possibly become the best TSP investment through the 1st of the year. As annotated below, the funds solid gain of +0.70%
allowed it to generate a buy signal. Also worth noting is the ascending channel that has been formed. It’s not to steep and can easily be sustained. Basically this Fund has suffered the a lot damage recently and as a result has the most room to run of any of the equity based TSP Funds.
I Fund.png
Not much to add here. We continue to wait for the market to make a definitive move. Right now nothing has changed enough on our charts to warrant an adjustment to our allocation. That’s all for tonight.
May God continue to bless your trades!
Scott 8-)

 




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