Fund share prices as of: 7/09/07

Fund -	G Fund	F Fund	C Fund	S Fund	I Fund
	12.01	11.21	17.11	21.09	25.19
$  Change -	+0.01	+0.02	+0.01	+0.04	+0.12
% Change -	+0.08%	+0.18%	+0.06%	+0.19%	+0.48%
	L2040	L2030	L2020	L2010	L Income
	18.59	17.64	16.77	15.35	13.27
$  Change -	+0.04	+0.03	+0.03	+0.01	+0.01
% Change -	+0.22%	+0.17%	+0.18%	+0.07%	+0.08%

Consolidating

Yesterday's modest gains brought the S&P 500 closer to resistance and still within the trading range.  The positive spin on this trading range is that the S&P is now in the same position it was 7-weeks ago.  That's nearly a two month consolidation.


                                Chart provided courtesy of www.decisionpoint.com
 

That is impressive, and healthy.  Still no major melt down in the face of so many troubling headlines.  Once again I believe this market has the potential to move significantly higher by year's end, but I continue to delude myself that it "should" endure a more significant sell-off before it takes off.  This 7-week consolidation is a big help in letting stocks digest their gains but the fact that we can't seem to get much more of a 2% or 3% dip is quite frustrating for traders.  Once again the buy and hold investors are getting the best of it, which historically, has not always been the case.  There are usually a few 10%, 15%, and even 20% drops, even in the best bull markets.  No such luck for some of us.  We are in the dog days of summer and if we don't get a good buying opportunity in July, August or September, we may be waiting a long, long time. 

For the next two days, the EbbChart System, the TSP Talk Sentiment Survey System, Trader Fred's TSP Trader System, and the TSP Timing Newsletter are all out of the market.  That doesn't happen often.  It should be interesting see what happens. 

SentimenTrader.com had some interesting information about one of its smart money indicators:
 

In the latest Commitments of Traders report, released [yesterday] afternoon, we saw one of those surprises.  "Smart money" commercial hedgers, who over the past seven years have typically held net short positions in the major equity index futures contracts, have swung to their largest net long position in history.  More than any other time in 20 years, these traders have amassed a long-side bet that the rally will continue.

 

With a nominal dollar value of $14 billion, their current position has become close to being matched only twice before - late May 1994 and mid-October 1999.  Both periods pretty much marked the low for the S&P when looking out over the next several months, and equities enjoyed gains somewhere between modest and outstanding. 

Yes, the market did rally after those other reading, but after those rallies the market did give back some of those gains, and we know what happened just a few months after the mid-October rally of 1999... in early 2000.  So this is an intermediate-term indicator (one to three months) - not a short-term (days) or long-term (years) indicator.

As mentioned, Trader Fred's TSP Trader System is currently on a sell signal.  Read more from Fred on the system page.

The EbbChart System is in the F-fund today, but that active system is on the move again.  Read more on the ebbchart page.

That's all for today.  I am currently 100% G fund.  See you tomorrow!
 

China Watch Shanghai Comp:   3,919 Recent High:        4,336 Prior Low:            3,404 Resistance:         4,231

Today  +0.98% as of 11:30 PM ET