TSP Talk - Thrift Savings Plan Strategies

Stocks mixed. Bonds up

Yesterday I said I was impressed with the recent action in bonds with Tuesday making a nice move higher and Wednesday pulling back some. So just before I went off to work I made the move to the bond fund (did you get the email alert?), which becomes effective today (Friday.) Wouldn't you know that bonds rallied all day afterward and now we are set up for a possible small pullback. That darn delay. The same thing happened to me when I moved to 100% F fund in August.

Someone asked me why I was going into bonds when the Fed is about to raise interest rates next week. The reason is that the rate hike is not going to be a surprise to anyone. It is already priced into the price of bonds. Bonds have actually done well after rate hikes recently. It is a sell the rumor, buy the news situation. I don't plan on spending the rest of my life in bonds. I'd just like to catch an overdue rally.

Stocks have been sluggish of late but small cap stocks actually did well yesterday. The intermediate term indicators have not repaired themselves but once again the short term indicators tell us the market has got to put up or shut up. It should rally from this level unless it is going to face a change in character and begin a more serious pullback.

Rev. Shark is talking like he is getting ready to pounce back into stocks as he believes we may have seen enough damage. He is as good a market timer as I know so I have to respect that analysis. We certainly may see a bounce here, but again we can't be as nimble as he can. I still believe a better opportunity will show itself in the coming weeks. If you can play the short term moves, I'd say go for it. Even though I try once in a while, I haven't had a lot of success with the jump in and out strategy.

The larger stocks of the Dow and S&P 100 (large cap index) have not held up as well as the S&P 500 and Russell 2000. The smaller the stocks, the less severe the pullback so far.

The S&P 500 is a large cap index but the Dow and S&P represent to biggest companies. The smaller companies of the S&P 500 have held up better.... so far.

                                  Charts provided courtesy of www.decisionpoint.com

The dollar again moved down to a support level. It should rally here in the short term, or like stocks, we could be seeing more of an intermediate top. This type of analysis sounds like hogwash - "The index should go up unless it doesn't. In which case it will go down." But that is how you view it from a technical analysis standpoint.

The support is still pretty strong but the more times you knock on the door, eventually someone is going to let you in. It is either gathering steam for another leg up, or running out of steam. We'll see.

                                  Chart provided courtesy of www.decisionpoint.com

So the market seems to be at a crossroads. It's time to put up or shut up. Bonds are looking better but yesterday's big jump could bring a small pullback. The G fund seems to be paying that penny more often lately as the interest rate hikes do have some benefits. The dollar is still trying to keep in a bullish uptrend which seems to be keeping the I fund from really blasting off (not that it has done too bad at all lately.) That's a lot to think about. My advice? After the 10 AM deadline (ET), forget about the market and enjoy your weekend.

Several people have emailed me about having problems accessing the site recently. I hadn't noticed any problems and the site's traffic has actually been pretty high the past few days - meaning not everyone is having the problem. Several of the emails came from a usda.gov email address. Maybe that agency has started to block the site? You may have to contact your IT administrators to ask that it be unblocked.

The only thing I can think of that has changed recently would have to do with the website address you use. If you used any other address than www.tsptalk.com, you may have seen an error page. I used other domain names to point to this site (such as www.tsp.net) but I had disabled those temporarily. I redirected them back so perhaps that will help. Keep me posted if you continue to have problems. Thanks.

That's all for today. Currently 100% F fund. Thanks for reading.