Good Evening, I’m sure many of you looked for a blog yesterday and when you didn’t find one thought that I didn’t want to post one because of the rough day in the market. Actually, I was celebrating my grandson’s 3rd birthday who lives about 2 1/2 hours from me so it was way too late to write a blog when I got home. But believe me, I wanted to write one. I wanted to praise God even thought the market dropped. He has always been with this group and those of you who have been with me from the start have seen several sell offs. Many of them have been worse than this to be sure. The goal is to stay in the saddle and not panic. No severe technical damage was done. So why would we cut and run? Is the sell off over? I’m not sure but probably not. It’s the time of year when we see poor seasonality and runs only come in spurts. So how about yesterday? The biggest factor was concern again about President Trump after the Acting Attorney General appointed an independent counsel to look into possible collusion between the Trump Campaign and Russia. The main issue however was not the Trump campaign but again was how the investigation might effect Tax Reform. As I have oft said, the whole rally since November has been about tax and regulatory relief. It may at times be vailed, but that is ultimately what it is about. My reaction to this is simple. I view any selling on news like this is transitory. In the end long term market trends are about fundamental issues like earnings and the economy. That’s not to say that we can’t go ahead and have a good correction but what it does say is that it’s going to take a lot more than a single news report to bring a bear market. I’ll ride with a healthy economy and good earnings any day. The market reacted to yesterday’s selloff with a bit of an oversold bounce today. It did drop a little this morning when a car rammed into a crowd in Times Square but recovered nicely after it was determined that the incident was not terrorism related. By the final bell the market regained approximately a third of what it lost yesterday. Like I said earlier, the selling may not be over. We’ll just have to watch the charts and see. One thing is for sure. Follow though on selling has been rare since computer algorithms started playing such a factor in trading. I recent years the V shaped recovery has become a regular occurrence. We have grown accustomed to the market popping right back and until that trend is broken investors will continue to buy every dip.
The days trading left us with the following results: Our TSP allotment gained +0.17%. For comparison, the Dow added +0.27%, the Nasdaq +0.73%, and the S&P 500 +0.37%.
Wall Street rebounds after steepest selloff in months
The days action left us with the following signals: C-Neutral, S-Neutral, I-Buy, F-Buy. We are currently invested at 100/I. Our allotment is now +7.95% on the year not including the days results. Here are the latest posted results:
| 05/17/17 | Prior Prices | ||||
| Fund | G Fund | F Fund | C Fund | S Fund | I Fund |
| Price | 15.3222 | 17.8668 | 32.7645 | 42.2779 | 27.7852 |
| $ Change | 0.0010 | 0.0988 | -0.5963 | -0.9658 | -0.2641 |
| % Change day | +0.01% | +0.56% | -1.79% | -2.23% | -0.94% |
| % Change week | +0.03% | +0.64% | -1.36% | -1.57% | +0.33% |
| % Change month | +0.11% | +0.64% | -0.97% | -2.50% | +2.52% |
| % Change year | +0.89% | +2.40% | +6.13% | +3.13% | +12.94% |
| L INC | L 2020 | L 2030 | L 2040 | L 2050 | |
| Price | 18.8389 | 25.3912 | 28.2338 | 30.3705 | 17.3976 |
| $ Change | -0.0532 | -0.1517 | -0.2745 | -0.3504 | -0.2312 |
| % Change day | -0.28% | -0.59% | -0.96% | -1.14% | -1.31% |
| % Change week | -0.11% | -0.29% | -0.50% | -0.60% | -0.70% |
| % Change month | +0.09% | +0.04% | -0.03% | -0.07% | -0.12% |
| % Change year | +2.33% | +3.73% | +5.21% | +5.93% | +6.57% |
Now lets take a look at the charts. All signals are annotated with green circles. If you click on the charts they will become larger.
C Fund:
S Fund:
I Fund: Still the best place to be. The I fund held up a lot better than the C and S funds did during yesterdays sell off.
F Fund: I wouldn’t trust this buy signal just yet. Bonds usually pop a little when stocks have a really bad day. I’d like to see some follow through on this signal. I will admit though that the SCTR has improved to close to 40. A strong bond market could mean a correction for stocks. We’ll just have to see how the story unfolds.
We managed a little bounce today. Now lets see if we can get some follow through in the coming days. Just don’t expect it all at once. That’s all for tonight. Have a nice evening and may God continue to bless your trades.
