NEW BLOG

I've decided to start a new blog called "maxyourretirement.blogspot.com".  I'm doing this mainly due to the fact that an institutional firm has expressed in interest in my work.  They have requested certain information be included that will make the new blog content be quite different.  I believe this will also benefit you.

I have saved your email addresses in the new blog so you'll continue to receive that automatically.  I'll have the first post completed no later than Sunday this weekend.  Have a blessed holiday weekend.

A PICTURE IS WORTH A THOUSAND WORDS

THE TRENDS:  Both the long term an intermediate term trends are solidly up.  A very strong up week this past week.  For the fourth consecutive week prices have closed above the all time highs made in November 2007.

WHAT I WOULD DO WITH LONG TERM FUNDS:  I've mentioned in past weeks that as the market moves higher I would commit more and more funds.  But the market has now moved up four weeks in a row without a pause.  It would be much safer to wait for a pullback to a support level and look for a bounce rather than just jump in now IMHO.  Have a great weekend.

THIS DOESN'T MAKE SENSE

THE TRENDS:  If you needed proof that fundamentals aren't the most important factor in forecasting market trends you need look no further.  Since March 2009 the market has been in an up trend.  A rocky ride along the way but in a general long term up trend.  This is spite of consistently negative economic news.  Below is the SPY Quarterly chart.  As you can see both the long term and intermediate term trends remain up.

WHAT I WOULD DO LONG TERM:  The currently developing bar represents the price movement from April - June.  As of May 10 the price is trading just above the bull market highs of 2000 and 2007.  One of two things can happen from here.  IF the latest bar closes on June 30 below the yellow resistance lines, this would signal at minimum a significant correction...and at worst a new long term bear market.  STILL, the market is bullish and as I've stated in past weeks, I slowly commit more money to the market as it proves it can move higher.  But I'll be quick to move 100% to the sidelines if my weekly analysis indicates an intermediate term down trend.  Have a great weekend and bless your Mothers & Wives.

MARCHING ON

THE TRENDS:  Both the long term and intermediate term trends remain up.  Last week closed up very strongly (see weekly SPY chart) well above the previous all time highs; but it did so on rather weak volume.  Whenever this happens it sets up the potential for a quick retreat back below all time highs.  So while the price action is very bullish, it was not confirmed by volume.

WHAT I WOULD TO WITH LONG TERM FUNDS:  As I've stated in previous updates I would have 50% of my portfolio in the market and only commit more when the market convinces me it's moving higher.  I might commit a little more at this point but certainly not 100% until the volume analysis convinces me that the bulls are fully in control.  Have a great weekend!

BOUNCE BACK

THE TRENDS:  Both the long term and intermediate term trends remain up.  This week closed higher than last week but prices remain stuck right around the major highs made in 2000 and 2007.

WHAT I WOULD DO WITH LONG TERM FUNDS:  Basically my comments have not changed since last week.  If the market makes a weak daily close below the levels I indicated (see weekly SPY chart), then if the market were to close next Friday below those levels, an intermediate term sell signal would be given.  If this happens, I will update the blog at that time.  Otherwise, look for the next update to be next Saturday.  Enjoy the beautiful spring days ahead!

CAUTION

THE TRENDS:  Both the long term and intermediate term trends remain up BUT...after closing above the 2000 and 2007 market highs last week (see two green lines on weekly SPY chart), the market closed lower this week.  This is cause for concern because MANY other factors are now in place to indicate a high probability shift in the intermediate term trend to down.  The ONLY trigger left is if next week there is a close below the 10 week moving average (blue line).

WHAT I WOULD DO:  Normally I would follow the system and stay in the market, only exiting IF there was a weekly close below the 10 week MA.  But the market is very overbought on every time frame, is right at levels previously associated with large corrections and ALL of the other indicators are pointing down.  My strategy would be to exit 100% if we have a daily close below the 153.50 level.  This level represents the lowest level price traded this past week and is also below the 10 week MA.  IF this happens, an intermediate term short signal would likely follow and prices could drop to the next levels of support, which is the 146 - 149 level.  IF this happens, I will update the blog that day.  If not, I'll update again next Saturday.  Have a great weekend!

MOVING HIGHER

THE TRENDS:  Both the long term and intermediate term trends remain up.  As you can see on the weekly SPY chart, the market not only closed up again, but it made an all time high, rising above the previous high made in 2007.

WHAT I WOULD DO WITH LONG TERM FUNDS:  The last several weeks I've pointed out that I would only have 50% of my funds in the market due to the fact that we're at levels where historically very large declines have taken place.  Well, now that we've closed at long term highs I would take that as a sign of strength.  I would slowly commit more to the market, maybe 10 - 15% or so, and gradually get 100% committed as the market moves higher.  The reason I would not go all in just based on this new high is that there is still a decent probability that this move may just be temporary before the market turns back down.  Have a great weekend!

SIT AND WAIT

THE TRENDS:  Both the long term and intermediate term trends remain up.  However, this week closed lower than the previous week and lower than where the market opened on Monday.  On a short term basis, this is bearish.  However, there has not yet been a weekly close below the 10 period moving average (blue line).  Until this happens (along with some other factors) the intermediate term trend remains up.

WHAT I WOULD DO WITH LONG TERM FUNDS:  Nothing has changed since last week.  Half of my account would be on the sidelines and the other 50% remains in.  I would exit 100% into cash when the intermediate term trend flips down.  Have a great weekend!

NOTHING NEW UNDER THE SUN

THE TRENDS:  Both the long term and intermediate term trends remain up.  As you can see from this week's SPY chart, the market closed slightly higher but price is stalling right around the major highs made in 2000 and 2007.

WHAT I WOULD DO WITH LONG TERM FUNDS:  My stance has not changed from previous weeks. Due to the strength of the market I would have 50% in the market but would exit 100% on an intermediate term trend sell signal.  Have a great weekend.  HE IS RISEN!

SITTING TIGHT

THE TRENDS:  Both the long term and intermediate term trends remain up.  However, for the 3rd straight week prices have closed right at/near the previous major bull market highs (see weekly SPY chart).

WHAT I WOULD DO IN LONG TERM ACCOUNT:  Nothing has changed relative to my comments the previous two weeks.  I wouldn't throw any new money at the market and would be very vigilant to exit 100% on the next intermediate sell signal.  I would ONLY get 100% invested again if the market makes a significant move above current levels.  Have a great weekend!

RISKY TIME TO BUY

THE TRENDS:  I could virtually repeat what I said last week.  In a nutshell, both the long term and intermediate term trends remain up BUT price is right at/near the price levels where the last two major bear markets occurred.  As you can see on the weekly SPY chart although this past week closed higher, it did not do so with much conviction. 

WHAT I WOULD DO WITH IRA OR 401-K:  I would be even more vigilant about protecting my profits than I was last week.  I would move more money into cash and only be exposed about 25% to the market.  I would be quick to exit the balance on an intermediate term sell signal.  The reason being that the probabilities are high that the next intermediate term sell would eventually evolve into a long term bear market.  Have a great weekend!

OFF TO THE RACES?

THE TRENDS:  The long term trend remains up and clearly the intermediate term trend does also.  As you know by now last week moved up very strongly.  HOWEVER, look at the SPY Quarterly chart.  This week closed at 155.44.  The last long term bull market that ended in December 2007 did so at the 157.50 level.  The bull market previous to that ended in March 2000 at the 155.75 level.

WHAT I WOULD DO LONG TERM:  Nothing has changed since last week.  Obviously the market is still very strong but I would be even more vigilant than last week about protecting my profits.  The reason is that any intermediate term correction (weekly chart) could very well translate into a longer term bear trend.  Have a great weekend!

WHAT NEXT?

THE TRENDS:  I could literally repeat what I said last week.  While the long term trend remains up the intermediate term trend has stalled.  This week closed only slightly higher than last week.  Also, as you can see in the image below, the weekly bar is once again gray.  In my opinion all it would take to start a significant intermediate term correction is a weekly close (red bar) beneath the 10 week moving average (cyan line). 

WHAT I WOULD DO LONG TERM:  Because the long term trend remains intact I would keep 50% of my available funds in the market but would not establish any new positions at this time.  I'll also be watching the weekly price action closely over the ensuing weeks.  If an intermediate term down trend is signaled I would move 100% into cash.  Have a great weekend...I'm off ice fishing with my son.  Life is good!

TO THE SIDELINES

THE TRENDS:  The long term trend remains up but the intermediate term trend has become neutral and is giving more and more signs that an intermediate term down trend is likely.  As I mentioned last week momentum (bottom indicator) has turned red.  This week closed lower than last week for the first time in the last seven weeks.  Notice that the price bar has turned gray.  Now take a look at the two down arrows...in March of 2012 and September of 2012.  These are the two most recent dates where both momentum had turned down and the intermediate term trend had turned neutral (gray bars).  Need I say more?  It was only a matter of weeks before the market turned down in earnest (red bars) indicating an intermediate term down trend.












WHAT I WOULD DO IN A 401-K:  I would immediately move at least 50% of my funds into cash and would watch the market for an intermediate term sell signal, at which time I would be 100% in cash.  Have a great weekend. 

THE BEAT GOES ON

THE TRENDS:  Both the long term and intermediate term trends remain up.  However, as you can see from the weekly SPY chart, this week only closed ever so slightly higher than last week.  Also, momentum is starting to become negative.  Despite this, market breadth remains strong.

WHAT I WOULD DO LONG TERM:  The last couple of weeks I've made mention of the fact that we're getting close to the 156 - 157.50 level, which represent the levels from which the last two major bear markets began.  Based on what I'm seeing I believe these levels will be retested before any meaningful correction may begin.  Bottom line is that now is not the time to be committing any new money to the market.  I would stay about 50% committed but will be watching the market very closely for signs of an intermediate term trend reversal, at which time I would move all of my money again to the sidelines.  Have a great weekend!

NOTHING NEW TO REPORT

THE TRENDS:  Both the long term and intermediate term trends remain up.  Once again last week closed higher, albeit only marginally higher than the previous week.

WHAT I WOULD DO LONG TERM:  Once again I've posted a quarterly (3 month chart) to show you how close we're getting to the 156-157.50 levels where that last two major bear markets began.  Because the market is continuing to show strength I would have 50% of my available funds committed but the closer price gets to the previous highs, the more vigilant I would be about exiting when a shift down in the intermediate term trend occurs.  Have a great weekend!

A LONGER TERM PERSPECTIVE

THE TRENDS:  Both the long term and intermediate term trends remain up.  Once again, this week closed higher than the previous.

WHAT I WOULD DO IN 401-K:  Last week I mentioned that I would not commit more than 50% of my available funds to the market and I continue to take that stance.  Here is why...take a look at the image below.  It is not the weekly SPY chart that I typically post but rather a Quarterly chart of the SPY.  Each bar represents 3 months of data (jan - mar, apr - june, july - sept, oct - dec) and the price history goes back to 1999.  Notice the two brown lines at the top of the chart.  These levels represent the end of the last two major bull markets.  As you can see we are very close to those levels now.  The bottom line is that even though a strong bull market exists, the probabilities favor at minimum, a strong correction once those levels are reached.  Over the next couple of weeks I'll be watching very closely for confirmation that both the intermediate and long term trends may be shifting to the down side.  Have a great weekend!

WELL WELL

THE TRENDS:  The long term trend remains up and so does the intermediate term trend as you can see from the weekly SPY chart.  For the fourth straight week, the market closed higher.

WHAT I WOULD DO LONG TERM:  I learned a very important lesson.  After such a huge weekly move up, I expected sometime during the next  1 - 3 weeks the market would make a daily retracement to allow a lower risk entry into the anticipated move up.  But it didn't.  The danger of simply entering the market after such a large move up, is that the market more often than not will retrace, and sometimes severely.  The flip side is that sometimes, the market will simply skyrocket higher and leave me on the sidelines.  From this point forward, if there is a large single day up move that signals an intermediate up trend, I will throw 30-50% of my available funds into the market.  Then, as the market moves higher, commit more and more.  That is what I'm doing next week. Having said that, I'm keeping a VERY close eye on the charts now.  We are getting very close to the price levels where the last two prolonged bear markets occurred.  The 2000-2002 and 2008 bear markets where the markets declined 50% or more.  Have a great weekend.

KEEP YOUR POWDER DRY

THE TRENDS:  Both the long term and intermediate term trends remain up.  This week closed higher than last week and slightly higher than the high of 148.11 made in September.












WHAT I WOULD DO IN 401-K:  Unfortunately for the past two weeks the market has grinded slightly higher and has not retraced enough to allow for a low risk re-entry in the direction of the long term trend.  As enticing as it looks to get back in, right now is a particularly risky time to get in.  The probabilities STILL highly favor some type of correction.  I would remain out of the market 100%.  Have a great weekend.

UNCERTAINTY

THE TRENDS:  The long term trend remains up as does the intermediate term trend.  I mentioned last week that my expectation was that over the next few weeks I expected the market to congest or retrace a bit.  That is exactly what happened this past week.  While the market closed higher than the week before, it only closed marginally higher.  More importantly, it did not retrace enough to give an opportunity to re-enter the market.

WHAT I WOULD DO:  I would still stay on the sidelines until there is more of a retracement that would allow me to get in at lower price levels.  Right now price is too close to the 148 level, which represents the high made in September.  To get in now is NOT a high probability scenario as the prices declined quite precipitously from this level just 4 months ago.  Have a great weekend everyone.

YIKES WHAT HAPPENED?

THE TRENDS:  The long term trend remains up and as you can see in the weekly SPY chart the intermediate term trend flipped up in a very decisive manner.  Last week I mentioned that there was a possibility that we could see a rally off the 40 week moving average (white line).  However, I was not expecting such a violent reaction to the up side after touching it.  While on the face of it last week's price action was very bullish, most of the upward movement took place on Monday and the day after New Years day.  Thursday and Friday's movement were not very strong at all.

WHAT I WOULD DO:  White it may be tempting to go all in (100%), I would not do so at this point for two reasons:  1)  The market moved too far too fast.  2)  The market is too close to strong resistance around the 148 level, which is the September, 2012 high.  My expectation is that the market will retrace or congest a bit early next week.  If this happens and we get a bullish day later in the week I would start "dipping my toes" in the water by committing perhaps 50% of my account.  Then watch the 148 level for signs to see what the market does next.  Have a great weekend!