Slow going
Volume has been drying up the last couple of days and the indices,
although up, aren't really going anywhere. That could be a
short-term problem as the oversold condition has repaired itself.
Looking at the S&P 500 chart below, you can see that after the index
moves up and then flattens out, much more often than not we see at
least a little pullback. If it is going to happen this time,
we'll likely see it begin sometime this week.
Charts provided courtesy of
www.decisionpoint.com
The market is no longer oversold and the bulls were probably hoping
for a little more follow-through from last week's bounce - although
it was quite a bounce. The NYSE overbought / oversold
indicator is now neutral in the short-term but the intermediate-term
reading (within the red channels) could be bottoming out. That
means we are getting closer to a bottom, or we have seen it already
- we don't know yet.
Charts provided courtesy of
www.decisionpoint.com
I have been hibernating in the F-fund
with Trader Fred the last few days hoping that any test of the lows
the market makes happens without me. It could take days,
weeks, or even months. We'll just have to keep watching to see
if the S&P can climb back above the 200-day moving average for more
than a couple of days.
Meanwhile, the AGG and F-fund closed at its highest level ever
yesterday.
Charts provided courtesy of
www.decisionpoint.com
That is not a surprise. If the economy is showing any weakness
due to the credit crunch bonds are usually a good place to be.
Many people ask why I would even consider using the F-fund, after
all, it is the worst performing fund since the share prices started
in 2003. But bonds do their best when the economy slows and
there is a need to lower interest rates, which is where we are
today. The credit trouble is leaving a black cloud over the
economy and earnings potential as we don't yet know just how deep
the problems run. That makes bonds a good alternative.
Trader Fred's
TSP
Trader System
remains on the sidelines (F-fund) and continues to expect a less
than stellar performance from stocks in the near future.
Read what Trader Fred has to say today on his
system page.
But a market is made up of buyers and sellers and the very active
EbbChart System
has been scalping gains during this rebound.
It is in the S-fund today but will it back off any time soon? Find out more on the
ebbchart system page.
I really don't have much more to add as the market floats between a
low volume rebound and a potential retest of the lows. I'll
use this time to remind you of one of the useful utilities that we
offer and link to on the home page. It's called
TSP Lookup.
It's an Excel spreadsheet that can be run any time of the day to
give you an up to date (intraday) overview of how the TSP share
prices are performing, as well as market index and
currency quotes. It was written by one of our members,
Jayhawker, and it is free, but if you like and use it, do me a favor
and throw him a small donation for his time and effort. It's a
pretty cool little program.
Check it out - Thanks
and enjoy!
That's all for today.
I am currently 100% F fund. See you tomorrow.
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