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.
Saturday, February 23, 2013
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.
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.
Friday, February 15, 2013
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!
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!
Saturday, February 9, 2013
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!
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!
Saturday, February 2, 2013
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!
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!
Subscribe to:
Comments (Atom)