Ok, the vacation is over and it is time to get back to the work that is the TSP. When I left on my vacation May 18th, who would have thought that the high’s of 2013 would coincide with my departure date. I think that is down right uncalled for. I mean come on, I’m on vacation, why the drama now? So maybe the same thing will happen in reverse come Monday morning and the markets will return to normal and start to ascend. Let’s look at the 3 major charts that concern us, S&P 500, Small Cap, and International. No, I do not want to talk about Bonds, they look worse than stocks at the moment and I want no parts of them yet.
The big chart above is the daily S&P500 but the little one to the left is the weekly and what I want you to see is simple. The over long term trend is still up and maybe a pullback here was logical. That doesn’t mean that we want to ride the wave all the way back down to find out if the trend is over. I did post Friday June 21st that everything was broken and everyone should be in the G. I stand the by that but we also know that I didn’t completely bailout because I was on vacation and the my timing was off. So from point of view, since I set myself up, I have to take another point of view. Price has recovered to the June 21 level and is slightly above it, so you can say that I got lucky. Ok, I admit that. So I went back and drew a horizontal line from the last pivot low that price closed above. That is my new bailout price. Price is $1652. So this time if that level broken, I’m out.
Ok, that is the rule for a bailout for me and those that didn’t bail June 21. Now how about a re-entry for those that did the right thing? It is easy to see that we are now is a short term trend and price is set below that level. Price is currently right on and close on the 50 day moving average. Then we have a CBL that is currently sitting at $1652. So it is pretty simple, price get itself up and above all those levels before you could say, here is my shot. $1652 or above is the level you are looking for to re-enter the C-fund.
Just like the S&P 500 the Small Cap long term trend is also still up and secure. Short term is also just like the S&P 500 which confirms that the overall market is in a correction. Is it a long or short term correction? No one knows until time goes by so we will use levels to get in and out. June 21 was also the exit date for the Small Cap and if you bailed to G, well done. Now if your are like me and didn’t, your new bailout price is going to be very tight at $831.
What is a little different here is that the price is currently closed above the 50 day moving average. That is a good thing. Now we need price to continue to climb above $860 and we have ourselves a new re-entry point.
I will not need to show you the long term on the International Index because it is broken. So if long term is broken, the short term is destroyed. Looking at the Short Term I see nothing that indicates that any type of reversal is even in the works. Let’s add more information to the damage here. Once price closes below the 200 day moving average, the long term traders normally start to bailout. In the last 5 days price has close below the 200 day 3 times. If your buying here, you bottom fishing and I do not play that game. Ever!
So there you have it. Not much good news to report here and just in case your still in, you have new levels to watch. If your looking to get back in, you have new levels to watch. I tried my best to stay on top of the bailout points while on vacation and I think I did that ok. What was impossible was writing this blog while riding a motorcycle daily. But I;’m back now!
TSP Distribution: C-fund 50%, S-fund 25%, G-fund 25%
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