A big day turns sour.

As I was getting ready for work Tuesday morning watching CNBC, I was a little sick seeing the Dow up about 100 points on the day I start a 50% G, 25/25% C/S allocation.  Then I realized these were the types of days I was waiting for to "inch" out of stocks, which is what I decided to do again.  I have now gone from 0% G fund to 25%, to 50% and now to 70%.  I know.  I've been a little more active in my account than I'd like to be, but sometimes moving a little at a time is the best strategy.

By the day's end yesterday, the early 1% gain was completely gone.  I had mixed feelings about that as well.  I would have liked to have gotten some kind of gain out of my 50% stock allocation but I can't complain if this is top forming.  This type of action can be considered "topping" but the market won't make it that easy for me.  It rarely does. 

Here's yesterday's intraday chart from Yahoo Finance...

         

The market's signature in the rally over the past several weeks has been strong closes.  One day is not a trend breaker but seeing a strong opening being sold off can tell us that the smart money, as we have seen in other indicators, may be using strength to step aside for now. 

So I am now 70% G fund and 30% S.  I went to the S fund just in case the rally continues.  It seems to have some legs.  With interest rates possibly peaking, and the Fed funds rate still relatively low, the small caps may not be as bad off as I had once thought they would be.  The I fund also put in a multi-week high yesterday.  If the dollar continues to pullback, it may be worth a play.

I doubt I will move any more into the G fund unless the market continues to rally.  Right now I will be looking for a pullback and the next buying opportunity.  My initial target on a pullback would be 1175 to 1180 on the S&P 500.

One more thing.  If you look at the seasonality chart at the bottom of this page, you will see the next couple of days are not typically very strong.  Today is the 6th trading day in June.

That's all for today.  Currently 70% G, 30% S fund.  Until next time...