If there was any a week one would learn or realize why I hate news it would be this week, but more on that later. We had a short week but an eventful week, and I wonder how many got scared and bailed out of the market. To say I wasn’t concerned would be a lie, but if you read my post from last week, I think you understood that I was a little concerned going into the week. But no one could have predicted Mondays news when the folks at the S&P made the announcement that they MAY have to reduce the United States credit rating from AAA to guarded. What the hell does that mean? Guarded? It’s AAA, AA, A, BBB, BB, and so on, so I’m confused. Either way, it was brief and Tuesday we had a little recovery followed by really good days Wednesday and Thursday. Look at last weeks post and compare it this weeks post and look at the numbers, not bad, not bad at all.
First I want to talk about I something I touched on last week and expand on it just a bit. You do not fight the overall trend, up or down. Take a look at the chart and there is a dark blue trend line that shows the current primary up trend that has been running since March 9, 2009. That’s over 2 years and yea there have been bumps, but you can’t argue with the facts on the chart. Next half way up, you will notice the current short term accelerated up trend in purple that is creating a nice wedge or triangle that meets June 13th. Price is also bouncing off the resistance line of $1344. My gut says it will break up because of the primary trend and it is always easier for prices to go up then down. Down is just more dramatic when it happens. Also if we forecast both purple and blue trend lines we can see that by a certain time frame we should hit the next resistance level between Oct 2011 and February 2012 of $1440. That would be almost another 8% gain on the S&P 500 and that would be nice. That is not a prediction !!! Do not bet your retirement account on that information !!! Remember what happened just this past Monday? No one can predict the future but you can estimate where something might be based on past information. You still have to watch the trends and make decisions on what you see. But either way, you would think by June 13th when that first resistance meets the purple uptrend, something gotta give.
I hate news sometimes, but that is life. Monday we had a dramatic drop. Tuesday things stabilized and closed up. Then Wednesday and Thursday we got all of this weeks down move and last weeks back to boot. So the primary trend proved to much for the sellers and the buyers came rushing back in an drove prices back close to yearly high’s which is resistance. So the conclusion looking at this chart is that we are still in an uptrend but we have been consolidating our run up in prices since February 18th, 2011. What we need to show strength this week is for price to close above $1340 or better yet, close above $1344. This would create what I call a higher high that is higher than the last high pivot which helps the uptrend.
The Small Cap, Nasdaq, Dow 30, and the International fund are all in agreement in with the S&P 500 and I see no reason to talk about them in this post. The Bond fund made a nice little 6 day run, but it appears to be reversing once again to the downside, so I would be careful with this fund.
TSP Distribution: C-fund – 50%, S-fund – 50%
No comments:
Post a Comment