TSP Talk - Thrift Savings Plan Strategies

More gains for the Dow but once again the rest of the market lagged behind. An 8% gain in Alcoa accounted for about half of the 48 point gain in the Dow. The Nasdaq saw more stocks down than up again, and small caps were slightly negative (although the S fund was flat.)

Yesterday I mentioned that earnings season was over but we actually have Cisco on tap tonight after the close. We also have the FOMC meeting on Wednesday so we do have a little excitement to look forward to.

When the market appears to be defying all logic, whether up or down, I tend to look around a little more for answers. I came across this article the other day and I didn't know whether to laugh or cry. It's from www.stariq.com and the author seems to be getting his market analysis from Uranus and Jupiter. Fill in your favorite Uranus joke here [.....]. The statement in bold got my attention.

Jupiter pertains to the principle of euphoria, exaggeration, optimism, and also panic and hysteria. Do you think there is some of that collective psychology evident in today’s investors and market commentators? How many market commentators did you hear this week that talked about the pressure on portfolio managers and investors being “forced into buying stocks” this week because they feared (panic) being left out of this market run? Uranus rules the principle of sudden reversals, as well as breakouts beyond support and resistance levels. A couple of weeks ago I mentioned that I thought we could see a few days of triple digits gains or losses as we entered this April 19-May 13 time frame, dominated by this Jupiter-Uranus square. So far we have only seen the gains as we approach this powerful signature. Once it ends, could we see triple digit down days? Yes, it is possible, and maybe even record or near record down days, for that is the nature of Jupiter (exaggeration) and Uranus (reversals without warning). - Raymond Merriman

It goes on and on with some pretty fascinating stuff, but again, it's tough to take seriously - but who knows? Some don't believe in technical analysis either. I don't know this guy's record. He may be a trading genius for all I know.

Well, I hope he's right but this market seems to be getting fuel from those of us sitting on the sidelines. That's right. That high bearish percent in the sentiment surveys means there is some dry powder on the sidelines that can be put into the market. With each minor dip, more and more bears are using the weakness to buy, which keeps the indices afloat. Again it seems like fewer and fewer stocks are participating, but like we saw in 1999 and early 2000, that can go on for several months before the major indices finally take the hit. The broader market peaked in October of 1999 but as we know the S&P, Dow and Nasdaq didn't top out until March and April of 2000.

Again, I am a bull - a frustrated bull looking for a chance to buy myself. When we saw a 6% drop several weeks ago, it was obviously a good buying opportunity. But you never know when those 6% drops are going to turn into 10% or 15% corrections. What's sad is that I actually said we may have seen the bottom just days after the low, but did I buy? No, I was waiting for another test of that low to show up. Once again it's a case of, you snooze - you lose.

But you know what is going to happen, don't you? We'll get another 5% or 6% dip, we'll jump in at the relief of getting another opportunity, and then the market will tumble 15%. Murphy's Law 101.

Oil was down again, as was the dollar, while bonds (well, the AGG anyway, not the f fund) and the international markets were higher. I don't really have any telling indicators or graphs to show today. Maybe today's action will give us something to work with other than Uranus.

Trader Fred's TSP Trader System is still on the sidelines after last week's sell signal. Read Fred's current commentary on the system page.