TSP Weekly update 3/22/13

TSP Distribution:  S-fund 50%, C-fund 50%

Lot’s of red this week if you look at the index weekly column on the above chart. Bonds and T-bills, F & G where the only 2 indexes to report a gain. But if you compare the Year to Date column you will see being in the F & G pretty much means your money is treading water while the other funds have been rolling. Nothing goes up forever, so maybe it is time. The question is, is it time. So let’s get out the Ouija Board and see if we can figure this thing out. NO? How about CBNC, Bloomberg, or Crammer? For those that want to stay and look at charts, keep reading. For all the others, see ya next week when you come back looking for the weekly numbers.

This week was a yo-yo week because one day we were up and the next down, so it was hard to watch on a daily bases. We have had a good year in the S&P 500 and we are up 9.16% for the year so a little pullback or sideways movement is not uncalled for. But if this index decides to rollover and starts losing to much profit, we will have to bailout. So we need to have a system and price levels to tell us to get out and after that a system to get us back in. After Fridays close it is pretty easy to see that we are in a sideways churn and we are in a very well built bull flag. The bull flag is 11 days old and most last about 10 – 15 trading days. Always? No, average, so I would think that movement up or down is going to happen pretty soon. Most bull flags continue upwards in the direction of the current trend because that is momentum. So all we can do here is wait and watch.

You can see on the chart above that the bull flag is prominent. Price is still above a rising 50 day moving average and above my CBL. Price is also above the intermediate and primary uptrends, so there is nothing to do here but still in and watch. If your out looking in, I would wait to see which way price breaks, up or down.

I could not get the $DWCPF chart to work tonight, so I substituted the IWM which runs the same as the TSP Small Cap index. The numbers on the chart are just different but the percentages are the same. The Small Caps are also just as safe as the S&P 500 index is as of this Friday, the 22nd of March. The only thing that is slightly different is that the Bull Flag is tilted downward. It is still a bull flag and we are still looking for price to continue higher out of the flag. Price is still above the 50 day, CBL and all trend lines. There is nothing to do but watch. If you’re in stay in and if you’re out, wait for the break out in one direction or the other.

Last Friday we had a confirmed buy signal on the International Index that we could have taken but waited till Monday by per chance. Monday it totally failed and fell back into the sideways bull flag. Now look really close at where price finished Friday. The intermediate trend line, CBL, and 50 day are all merging to one spot and that means something has to give. Seems to me that price is going to decide next week a direction based on this chart. I will be fun to watch and I’m glad that I’m still out on this index. The I-fund or International Index is a watch and you should not be in this index unless you are gambling or in the L-funds.

Just like the International Index, bond closing price Friday puts it at a point where a buy signal should fire very soon. If the S&P500 and Small Cap collapse next week, you can bet that this index fires a buy. If the opposite happens, then more watching will take place. I’m still out here but I’m watching closely.

Conclusion: The markets are churning and looking for a catalyst to send it in one direction or the other. When there is no earning news, sometimes other new dominates and prices knee jerk. I think that is where we are right now. So in my opinion, based on what price has been doing the last 10 trading days, price could break hard in either direction very soon. Since I’m still 100% invested in stocks and the TSP, I’m hoping up, but I do understand the risk. The odds are in my favor for break to the upside, because those are the averages for up trends and bull flags, but nothing in the stock market is a sure thing. So if your in, stay put, but if your out, wait for it.

Smile, if your reading this you’re alive and because the alternative is not quite the same.

I’ll be in Greensboro, NC this weekend to see George Strait and Martina McBride in concert. For you folks to young to know who he is or who think he is to damn country, here you go. One of the last pure professionals who honors his profession. Watch the last few seconds, the laugh is priceless. Try listening to that laugh an not smile. Good night all.