Making a decision and the dollar's surprise

We have all been faced with the decision to either stay on the sidelines while the overbought intermediate term indicators repair themselves, or to go with the short term indicators which have become oversold, combined with the strongest seasonal period of the year.  All of the last five trading days in December have closed positively 60% to 70% of the time over the past 50 years.

It was not a surprise that I moved money out of the G fund after only one day.  I had mentioned that that was a possibility.  But some of you may have been surprised that I finally put some money in the stock funds.  The tough tiebreaker was broken because of my respect for RevShark's opinion when it comes to short term market calls.  He has been quite adamant that we are setting up nicely for a strong Santa Clause rally.  The indices were looking pretty good early on yesterday, after the S&P 500 bounced off of the 20-day moving average, I went ahead and put 25% in the C fund and 25% in the I fund.   The rest is still in the F fund but that may change. 

When that deadline starts to get close and I am running out of time to get out the email alerts out, update the message board, and of course make a decision on what allocation to use, sometimes I don't have all of the information I'd like to have.  It turns out that not only did the small caps start to perk up, but the dollar, which I had anticipated making a big move, made a big move... in the other direction.  I had been expecting a push down to support.  Instead it shot straight up.  That could actually work out for me in the short run but it put a different slant on using the I fund.


                             Chart provided courtesy of www.decisionpoint.com

At this point I don't know if that was a flash up with an expected "give back" reaction today, or if the recent pullback is over and the dollar is ready to head back up.  So, I anticipate more moves in my account.  I'm not so sure I want to be in an already extended I fund if the dollar is going to start to rally.  I think I'd rather use C or S.  It's never easy is it?  Not for me anyway.

With 50% in stocks and 50% in the F fund, I may move more into stocks as we head toward the end of the week.  After sitting idle like a deer caught in the headlights since late October, I am now doing a bit more trading.  This may not be for everyone so please be careful.  If you have done well this year you may want to just ride out what has been working for you.  I am just trying to have a little fun as I attempt to salvage my somewhat damaged 2005 account.

I have some things in the works for 2006 and I am going to try to play my webmaster role a little more between now and the end of the year.  Since many people are on vacation, you may see shorter market comments for the next two of weeks as I tackle some new projects.

I have been discussing changing the message board software.  That may take a couple of days and may cause some down time there.  I am also currently working with RevShark on another project we hope to have available here in January.  More details to follow on that.  Another website contacted me about pulling our resources together so there could be more changes ahead.  2006 should be excited for us.

That's all for today.  Currently 50% F, 25% C, 25% I fund, but I still plan to be active during the next week and a half.  Thanks for reading.