Good Evening,
It was an absolute roller coaster today. It’s true that the market did come back in the final 30 minutes of trading, but the action in small caps and momentum stocks gives me great concern. I just do not feel comfortable with this market. Also of great concern is the continued rotation into stocks like Walmart and ATT. Those are not leadership names. James DePorre (RevShark) explained it well in his afternoon comments. Here is what he had to say:
“The bulls will point to the sizable intraday bounce, the strength in the DJIA and the relative outperformance of names like GIS, WMT, JNJ, PG, WM and MSFT. These big caps are moving the indices but they are not good leadership material. These are stocks that are used as places to park cash by funds which must stay invested. They aren’t really expected to produce big returns but they are less likely to pullback like a FB or TSLA in a weak market.”
That is why I currently call myself a bear. Now on to today’s news:
Stocks end higher after roller coaster day
The day’s roller coaster left us with the following signals: C-Buy, S-Sell, I-Buy, F-Buy. We are currently invested at 08/G, 92/F. Our allocation is now -3.85% on the year not including today’s results. Here are the latest posted results:
| 04/25/14 | |||||
| Fund | G Fund | F Fund | C Fund | S Fund | I Fund |
| Price | 14.3934 | 16.1888 | 24.2232 | 33.5103 | 25.9018 |
| $ Change | 0.0009 | 0.0163 | -0.1974 | -0.5470 | -0.0862 |
| % Change day | +0.01% | +0.10% | -0.81% | -1.61% | -0.33% |
| % Change week | +0.05% | +0.38% | -0.06% | -0.83% | +0.42% |
| % Change month | +0.16% | +0.77% | -0.36% | -3.10% | +0.56% |
| % Change year | +0.74% | +2.84% | +1.46% | -0.48% | +1.32% |
| L INC | L 2020 | L 2030 | L 2040 | L 2050 | |
| Price | 16.9837 | 22.0453 | 23.736 | 25.1273 | 14.2292 |
| $ Change | -0.0257 | -0.0898 | -0.1280 | -0.1611 | -0.1028 |
| % Change day | -0.72% | -0.15% | -0.41% | -0.54% | -0.64% |
| % Change week | -0.05% | +0.05% | +0.02% | -0.01% | -0.04% |
| % Change month | -0.52% | +0.07% | -0.14% | -0.29% | -0.43% |
| % Change year | +1.18% | +0.99% | +1.15% | +1.18% | +1.18% |
It doesn’t show on this chart but the S fund has another rough day today reflecting the action in small caps that I noted earlier. Note to you 100 S’ers : 2014 is different, be careful!!!!! The C and I funds did manage to bounce back with moderate gains at the end of the day, but I don’t trust the action at all. I feel like God has us in the right place. He’ll never let us down! I am unable to share my charts with you due to Stockcharts.com. I can say that we continue to trade in the same range (1860 to 1890 for the S&P 500) that we have been trading in since late February. Nothing will change until that upper or lower resistance is broken. I still favor on down side resolution sometime in May. To support that analysis we now have a head and shoulders pattern that has developed which as you know is a bearish pattern. This recent chart of the SPY which is the S&P 500 ETF should give you an idea.
It’s a tricky market. We’ll continue to read our charts and stick with it as best we can! As I said, I still expect to see more downside in the not too distant future. Have a nice evening and may God continue to bless your trades!
Scott
