Market Comments

June 11, 2007

 

Fund share prices as of: 6/08/07
Fund - G Fund F Fund C Fund S Fund I Fund
11.96 11.18 16.82 20.53 24.24
$  Change - +0.00 -0.01 +0.19 +0.21 +0.21
% Change - +0.00% -0.09% +1.14% +1.03% +0.87%
  L2040 L2030 L2020 L2010 L Income
18.19 17.30 16.48 15.17 13.17
$  Change - +0.16 +0.13 +0.11 +0.06 +0.03
% Change - +0.89% +0.76% +0.67% +0.40% +0.23%



Today's Comments (Short Term Outlook)                             Printer friendly

What's on this week's plate?

OK, we all saw it - market drops Tuesday, Wednesday and Thursday, and Friday sees a rebound that gets back a chunk of Thursday's losses.  The rebound in the S&P 500, which was on lighter volume than Thursday's sell-off, ran up to the lows of the prior dip in May.


                                    Chart provided courtesy of www.decisionpoint.com

In a "typical" market, this is where the index would have some problems and possibly roll back over, but this market has been anything but typical and we know anything can happen. 

The NYSE overbought/oversold indicator moved down to an extreme oversold level on Thursday.  That -750 area is where we "typically" see a bounce, as we saw Friday, but looking below, you can see that the rallies that follow, tend to encounter another bought of selling and a lower low, or at lease a test of the prior low, in the indices before a bottom is made.


                                      Chart provided courtesy of www.decisionpoint.com


The 10-day moving average of the ARMS index is still nowhere near a buy.  Although the market doesn't need a buy signal to move higher, a buy signal is generated when this indicator moves to the 1.50 area.  Even 1.30 is acceptable.  The current 1.00 reading is neutral if anything.   The 2.75 reading in March was a very strange occurrence and is why the chart looks skewed.


                                    Chart provided courtesy of www.decisionpoint.com

 

The TSP Talk Sentiment Survey system is starting this week in a 100% S fund allocation after the 1.21 to 1 bulls to bears ratio in last week's poll.  The system has done very well the past two years (up 28% in 2006 and, over 13% so far in 2007) but don't sell the farm just yet.  It is not foolproof and can have off weeks.  In the long-run however, this system is one to keep an eye on.
 

The EbbChart System made some good calls last week but was whipsawed a bit Thursday and Friday.  The charts are showing some green early this week. Read ebbnflow's recent commentary on the ebbchart page.

Trader Fred's TSP Trader System hit its stop loss after Thursday's sell-off and will begin this week in the G fund.  The stop losses are in place to get us out of the market before any real damage is done.  Sometimes the market just rebounds after a big drop, and other times it goes from bad to worse.  This is a defense mechanism in place to avoid big losses.  Trader Fred sent me some stop loss analysis to show why we are better off with them then without them.  I haven't had time to put the data into a readable page yet, but I'll get to it later this week.  Read more on the system page.

That's all I have for today.  I am currently 100% F fund and looking for a chance to get out.  Bonds are down and could see a rebound giving us that chance.  See you tomorrow.

 

China Watch
Shanghai Comp:   3,977.15
Recent High:        4,335.96
Resistance:         4,231.00

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