NOTHING NEW

LONG TERM TREND: The outlook is neutral for the time being, largely because last week was the week after a holiday, where most traders take time off. As you can see from the price bar there wasn't much movement and look where price closed again...right near the 40 week moving average.



SUGGESTION FOR 401-K: I hate to sound like a broken record, but the market needs to show some more conviction to the up side above the 40 week moving average before I get involved. I will be watching price action on a daily basis next week and will update the blog if I do anything. Have a Happy and blessed New Year!

STRONG WEEK BUT....

LONG TERM TREND: This week closed up strongly compared to the previous week but look where price stopped again (see attached image). Yes, right at the 40 week moving average.



SUGGESTION FOR 401-K: Despite the strong up week there has not yet been a decisive move above the 40 week MA. Until this happens the probabilities favor the tendency of the market to sell off once it's at this level, which it is now. Next week I'll take a look at the daily price action and see if there is any follow through to the up side. If there is and I get back into the market I'll update the blog. Until then, I wish all of you a very Merry Christmas!

THIS IS GETTING OLD

LONG TERM TREND: As most of you probably know by now, once again the market closed down from the previous week. Take a glance at the attached chart and you'll see once again that the market failed at the 40 week moving average. This is not a healthy sign for the stock market.



SUGGESTION FOR 401-K: Big surprise! I'm on the sidelines. I suspect the rest of you are about as tired as I am of not having my 401-K money work for me. This is my opportunity to rail on 401-K plans. The main problem is the fact that you are limited to investing solely in mutual funds. The problem with this is that in a sideways to down market the vast majority of mutual funds will perform similarly to the broad market. The fact of the matter is that on a long term basis the markets have become very unpredictable. So unless the market is trending up the ONLY benefits of investing in a 401-K are the tax benefits. In my own situation, I stopped years ago contributing any additional funds to my 401-K. The reason is that IRA plans allow a lot more flexibility in investment choices, including employing the use of options. Bottom line is that the above market returns you can earn with this type of flexibility outweigh any tax benefits. I plan on telling you more about what I'm doing in this area after the new year.

Be Blessed and prosper!

NOWHERE FAST

LONG TERM TREND: I wish I had something new to tell you but look at the attached chart. The market opened higher than the previous week, but then sold off, rallied and then closed just below...once again...the 40 week moving average.



SUGGESTION FOR 401-K: The market still has no conviction one way or the other. Far too risky at this point for me to put my long term funds at work. Have a great weekend everyone.

POWER OF THE WEEKLY 40

LONG TERM TREND: Just take a look at the attached chart of the weekly S&P. The first thing you'll notice is that last week was a very strong week compared to the previous week. However, take a look at where the market closed. On Thursday the market ran right up against the 40 week moving average. On Friday the market closed down from that level.



SUGGESTION FOR 401-K: I'm not dipping my toes in the water yet. Once again the 40 week moving average acts as a formidable resistance point. Until we get some bullish price action above that area we really don't have a good idea of which direction the market may go. Have a great weekend and any questions or comments are welcome!