Transfer 5/26/ for 5/27/04

[tsptalk]

That end of May / beginning of June data is just too complelling to ignore.I will move the 25% I have in the G fund into the S fund this morning. Thatleaves me35%C and 65%S. It will be effective Thursday morning (2nd to last trading day in May)...

http://www.tsptalk.com/images/seasonality_may.gif
Chart provided courtesy of http://www.sentimentrader.com (http://www.sentimentrader.com)

The first five trading days in June are also all above average.

[puertorico]

Tom just a comment

What ignoring th I fund ?

[tsptalk]

I think C and S will do better. Just a hunch because of the dollar which should rise after coming down for about 2 weeks.

Haven't seen you for a few days PR.

[tsptalk]

I'm actually rooting for some selling today. A nice 50 point drop in the Dow would be healthy for the overbought condition. Then the rally can resume tomorrow when I'm more fully invested. ;)

[Rolo]

tsptalk wrote:
I'm actually rooting for some selling today. A nice 50 point drop in the Dow would be healthy for the overbought condition. Then the rally can resume tomorrow when I'm more fully invested. ;)
/me chuckles.

So how much of a run-up by, say, Jun 2, would you consider to be "too much, too fast" and sell?

A lot of strong companies on my watchlist (and portfolio)are taking off very rapidly, i.e. SCSS, RHAT, WBSN and have put daily stop limits on them to sell on a huge jump.

[tsptalk]

Rolo wrote:
So how much of a run-up by, say, Jun 2, would you consider to be "too much, too fast" and sell?

This may be too optimistic, but we should find resistance at the 1135 and 1150 area on the S&P 500. And actually, the strongaverages run through the first 5 trading days of June. I'll post June's chart when I get home later.

[Rolo]

I'm already there, 30C/70S :D (edited)

Gotcha...so exit plan possibly for Jun 4 or 7. Ya! I'll go with that, speculating that the MACD will be like it was those two weeks in April. (heh...sound like I know what I'm talking about? 'cos I really don't.)

I was thinking 1155 also, same as before, small pullback, then, hopefully, the resistance becomes support and not another three-month trading range hoop-de-doo.

I am thinking that the leading stocks which are jumping, if they do not forfeit all of their gains and only pull back slightly, then that is indicative of iminent market performance, a litmus test. You think?

[tsptalk]

Yeah. At this point is seems like we have had role reversal, bears are covering short positions on the pullbacks causing the market to stay up. It may be too early to tell though.

[tsptalk]

By the way, 70% I fund? I guess you aren't buying my dollar theory. :u

[Rolo]

D'oh!

See, this is why I am 'bad' at 'math': Something goes awry from the brain to the fingers, hehe.

eeeeeeeSSSSSS

Plus, I'm nervous around new people. :shock:


[line]


Yes, your dollar theory and interest rate knowledge are why I am in the C fund, which I had no use for hitherto. Pat yerself on the back! :cool:

[tsptalk]

tsptalk wrote:
Rolo wrote:
So how much of a run-up by, say, Jun 2, would you consider to be "too much, too fast" and sell?

This may be too optimistic, but we should find resistance at the 1135 and 1150 area on the S&P 500. And actually, the strongaverages run through the first 5 trading days of June. I'll post June's chart when I get home later.
As promised...

http://www.tsptalk.com/images/seasonality_june.gif
Chart provided courtesy of http://www.sentimentrader.com (http://www.sentimentrader.com/)

[Pete1]

Hello folks:

Since going ultra conservative (for me) a few weeks ago (21C, 21S, 21I, 37G), I have been gradually moving back into a higher allocation to stocks. Tom's advice to buy the dips worked very well. I have only been buying when all of the stock funds are in the red (preferably when S and I are down more than C). Currently, I'm up to 81% (32C, 25S, 24I, 19G). I would like to continue to increase my stock allocation to about 90% stocks (36C, 27S, 27I, 10G). I have been overweighting U.S. stocks more so (I usually split the stock $$ equally between the 3 funds). Also, I have been allocating slightly more to the less volatile C fund. I am at an impasse. We have seen a lot of green lately and I am wondering if any red is on the horizon. I guess I will just stick it out and wait for a red day. Of course, if things keep going up, the inevitable red day may still be more expensive than today ;)

[tsptalk]

Pete -
Here is someinformation for you. Probably useless, but if it helps you make a decision...

One stat I saw was that the Tuesday afterMemorial Day is weaker than an average day. But, it happens to fall on June 1st this year which is historically above average.

The Friday before Memorial Day, like the day prior to most holidays, is typically stronger than average. But we have seen some weakness going into weekends last several weeks. Last Friday was up however as there seems to be a more optimistic view of the market lately.

The second week of June (see chart above) tends to give back some of the earlier June gains.

Like I said, mostly useless info. But I use this stuff when I have to make a tough call one way or another. There are many people still in cash or even short that are buying any weakness out of fear of missing the boat. I believe that is why we are seeing strength even in this extreme overboughtcondition.

Tom

[Rolo]

OK, for the seasonality play, we are looking to put a transfer to Gbefore noon, Wednesday, Jun 2 that will happen at Thursday, Jun 3's closing prices.

Then, if all goes well, we put a transfer back into C/S before noon, Monday, Jun 7 to take effect at Tuesday, Jun 8's closing prices. Or, Jun 17's closing prices may be better.

Correct?

I don't have a Plan B yet, but I assume waiting for a dip would be it since the bulk of June is pretty depressing.

And in Pete's case, if history holds true, just wait until the downtrend just about completes itself.

[tsptalk]

OK, for the seasonality play, we are looking to put a transfer to G before noon, Wednesday, Jun 2 that will happen at Thursday, Jun 3's closing prices.
Rolo -
I'm not sure why are you saying June3rd. Is that based on that June chart? If you use the historical data (which isn't always a great plan,but it is something) it looks like the 6th trading day of June is where the weakness kicks in. That would be June 8th.

[Rolo]

Ooooooohhhh!! I need a mallet that says "Trading days" to smack myself. I was reading them as calendar days. Dirty blonde and Polish, an embarrasing combination at times....and that is why I ask lots of questions....to save me from myself! heh

O'hell, I think I was looking at May part of the time, too.



Ok, attempt #2: For the first dip, sell June 7th closing prices, buy back at close of June 9th (Day 7), correct?

The next question is, is anyone going for it as a plan versus just keeping it "under advisement"?

[tsptalk]

is anyone going for it as a plan versus just keeping it "under advisement"?

I will keep it under advisement. I am debatingon what to do tomorrow (Friday). The first day of the month (next Tuesday) tends to be a pretty good daybut the day after Memorial Day can be weak historically. The indices are now beyond being extremely overbought. Another big morning on Friday and it might be hard to stay in 100% for Tuesday.

caution:Trading using historical data can causepain. Your misreading of the chart could produce better results then the correct numbers. You just never know. :*

But like you had said one time (and I don't remember how you put it), if you have something to help you make a decision that goes beyond making a complete guess, then you have a small advantage. <-- I'm sure you said it better than that :)

[Rolo]

tsptalk wrote:
Your misreading of the chart could produce better results then the correct numbers. You just never know. :*



hahahahahaa....lol! That is too funny.

Histerical!

[line]

Itook a break after I had thegrowing feeling that the more analysis and logic I applied to my trades, the more wrong they were. On top of that, the less I went on an unpremised urge, the more I missed out, which actually feels worse.

But, I am still learning. I think. I hope. Bah! It's something to do, in any case.

[Pete1]

I ended up staying pat. I think it was fate that the internet was down this morning ;) If we are down tomorrow AM, I think Imay ease a little more into C fund (35C, 25S, 25I, 15G) but Rolo's idea of waiting until things are a historically weakersounds good as well. I am still somewhat wary of Greenie's end of June forecast. He worries me more than anything else out there right now. The long-term trend Tom pointed out this AM for the S&P sure looks promising :^

On another note, it would be fantastic if TSP would extend the cutoff for transfers - my wife's account at Vanguard cuts off at 4PM eastern time for the next day's business. Also, it would be really cool if TSP would allow participants to transfer between funds, eg, G fund to C fund rather than reallocating everything. One of these days maybe :shock:

[VictorPR]

As time goes on and I read you guys I have to share a bit of information that I have learnedduring the past 7 months, since I started moving my shares....... On May 6, 2004 I had nice TSP Account ($) all invested in the I Fund, as the I fund and the market started to loose ground and got nervous I pulled out and then every few days I will jump back in it and loose some more money! ! ! I finally started making some of the money back ( I lost over $10,000) during those weeks but now that the market is coming back and checking my figures I started at 13.13 (I Fund) and today is at 13.20......If I had left it alone today I would have made more money than I started with, but I am still $6,000 less than what I started with. From now on I will let it ride and see what happens........Thanks

[tsptalk]

Thanks Victor. Hope things work out. Trading can have frustrating moments. To be 100% I fund all the time should bring you some wild swings. Basically you are betting on foreign markets and economies outperforming ours for the long term. I'm not sure I would make that bet. But if it does work out, you could have some big gains.

Good luck!
Tom

[GTO1970]

Tom,

What is your current allocation?

site show you 25G,35C & 40S

your email on the 26May04 shows 35C & 65S

GTO

[puertorico]

Tom any plan tochange today for monday ?

I still have 10 in I fun ,looking forward to put

a little more becouse when the dollar is down

I-FUND benefic.

bUt we don't know is monday dollar gonna still down ?

[tsptalk]

GTO1970 wrote:
Tom,

What is your current allocation?

site show you 25G,35C & 40S

your email on the 26May04 shows 35C & 65S

GTO


Thanks GTO. It's 35% C, 65% S. I must not have updated the new file. It should be right now.

Thanks again.
Tom

[tsptalk]

Tom any plan to change today for monday ?
I'm still watching. I'll probably decide by 11:30 AM ET today. I don't know about getting into the I fund just yet either. Maybe some time next week.

[puertorico]

This is the problem :?when I suposed to take

money out the table and grab the profit then

I become greedy...:D

[tsptalk]

Taking money off the table here is not a bad move. We could still move higher but the long weekend and the overbought readings make at least a small pullback, as we are seeing today) likely.

Of course the risk is missing more upside movement. Plusthe first few days of a new month tend to be good. It's a tough call.

[tsptalk]

tsptalk wrote:

Tom any plan to change today for monday ?
I'm still watching. I'll probably decide by 11:30 AM ET today. I don't know about getting into the I fund just yet either. Maybe some time next week.

Someone who trades currencies seems to agree with my thought on the dollar right now. This is from advn.com...

"Yesterday's price action was exaggerated, even if, as we argue, that the
foreign-exchange market has adjusted to the shift in expectations of the
trajectory of U.S. monetary policy," said Meg Browne, currency analyst with
HSBC. "The outsized dollar losses seemed to have been largely a result of
speculative flows, thus leaving the market more prone to profit-taking."

In other words, currency tradersthat made money on the dollar falling could take profits and send the dollar up a bit in the short run.

[puertorico]

...in the short-run...:shock:

[tsptalk]

Yeah. If the uptrend of the dollar is over as the chart suggests, we may get a few days of upward action because of the excessive move down, then a slower decline may be in the works.

I don't say this because I know anything about currencies or economics. It is just based onyears of reading technical charts.

The dollar is up today against the pound and euro by the way.

[puertorico]

Tom

...Done,I pulled-out of I-fund for tuesday ,I'm out:shock:

:Dthank for the warning.

bY the way...

Hope today get in the green becouse when the day

before holidays is up ,the day after holidayis up too,and

vise-versa.When the day before holiday is down then

the day after HOLIDAYis down too...:D

[tsptalk]

Now remember, I'm not saying the EAFE index will be down necessarily. There is no real reason for me to think that. I am saying the dollar may be up and it could slow down the I fund a bit even if the EAFE is up.

About the long weekend. If people are getting nervous and pulling out because of the unlikely possibility of some sort of attack this weekend, then if we don't have an attack, that money will probably go right back into the market on Tuesday.

It won't surprise me to see some late selling because of the fear (unless some traders are thinking the way I am). So Tuesday could be agood assuming nothing happens over the weekend.

[puertorico]

I read u !

...the I fund can be up and

not pay enouff divident.

"when dollar is up bring I-FUND down"

and vice-versa

"when US DOLLAR is down I-FUND benefic "

I got it ,better be caution !

[puertorico]

...By the way Tom

Where I find IT !

...if I want to know is the dollar is weak or strong ?

[tsptalk]

Where I find IT ! ...if I want to know is the dollar is weak or strong ?

http://www.advfn.com/p.php?pid=forex

They are shown as pound /dollar,euro/dollar etc., so if the top chart is down, it's the pound or euro that is down vs the dollar (meaning the dollar is up).

If the chart is up, it means the pound or euro is up and the dollar is down.

The top chart is the daily chart. The bottom row is a longer term chart.

[Rolo]

puertorico wrote:
This is the problem :?when I suposed to take

money out the table and grab the profit then

I become greedy...:D


haha! Amen to that! Yeah, I had to forfeit some paper profits before learning that lesson. I am sure I will get the occasional reminder, too.


On the flip side, my history of taking my profits too early probably cost me more than selling too late.

But somehow it feels much worse having had and lost than never having had at all.

[puertorico]

Nice stuff ,Even not being good with chart

I'll try to learn.nOw I'm leaving and later gonna take

a better look.Its good TO know When the dollar up or down

before any trade. U see I become a better investor...Thank Tom



Rolo

U having fun ah !:D

Good gain and then feel the pain :?

I have been there :?:D

Wow time flies when you're having fun...I've been out of pocket the last couple of days. But before I flew the coup, I moved some off the table, and back into the G fund-made move back Wedesday.



I am now 65% G, 10% C, 10% S, and 15% I (gotta keep some I fund...ha). Hope to catch some opportunities to jump back in on the downward trip.

[tsptalk]

(gotta keep some I fund...ha).
I think you are right. If we get a bit of a pullback I will have get something in the I fund now that the dollar broke it's trend. Probably next week.

Sorry if I sound like a broken record on this subject. I know many readers follow the moves I make and I want everyone to know where I stand.

Tom

[Rolo]

So you think the buck has started a new downtrend completely?

I talked to a fellow today who believes so...so much that he moved all of his investments internationally. I shall try to get the details of his thinking.

[tsptalk]

The uptrend was broken so... it's possible the longer term downtrend may resume.

Remember I had mentioned that Warren Buffett thoughtthe dollar going to go down, and I didn't believe it. I guess that's why he's a multi-billionaire and I'm a lowly multi-thousandaire. :D

[Rolo]

haha...Yeah, it's hard to argue with a multi-billionaire about the market.

I am going to wait to see if it changes course or resumes falling, as well as keep an eye out for commentary on it. Then, I will weigh that against our rally, as in, if it is just another futile attempt or for real. Then there are interest rates....

[puertorico]

http://www.advfn.com/p.php?pid=forex


Tom I see the chart today

Euro/us dollar

The chart is down 1.2226

So,that means dollar isup and I-fund not benefic in the trade ?

I'm doing my home-work :D

[tsptalk]

puertorico wrote:
Tom I see the chart today

Euro/us dollar

The chart is down 1.2226

So,that means dollar isup and I-fund not benefic in the trade ?

Yeah, the pound andeuro are up vs. the dollar. When the dollar is down, the I fund usually does better than the EAFE index.

I am now 65% G, 10% C, 10% S, and 15% I (gotta keep some I fund...ha). Hope to catch some opportunities to jump back in on the downward trip





I think I'm ready to further take more cover in the G--basically looking to bail my 35% out of the equities. This will most likely be a very short term move, but I sense a lot uncetainty in the market. I didn't do this today, but may be Tomorrow or Friday. Tom I don't blame you for taking some more of the table, at least until there is some solid direction in the market. Nobody wants to get caught hoding the bag when the market is going sideways or dropping precipitously.

[tsptalk]

retire rich wrote:
Tom I don't blame you for taking some more of the table, at least until there is some solid direction in the market. Nobody wants to get caught hoding the bag when the market is going sideways or dropping precipitously.

The resistance and the overbought condition was there so the writing was on the wall for a pullback. You just never know when though. This is all normal stuff though. I'm not too worried. Could be jitters before the morning jobs report.

I am hoping the S&P can hold the 1100-1105 area. That may be a place to start getting some back in.