Hello Everyone
As we enter mid-month, I wanted to update everyone as to the market’s performance. The SP 500 Index, which I use to measure the health of the market, is at new highs, never before seen since 2008. On Friday Jan 18, it had reached a high of 1485.98. Call it “1486” and basically anything above that is untouched territory. That is a good thing, as it indicates that money is coming back into equities (stocks) and propelling the market higher.
I should also mention a concept known as “The January Barometer”, developed by Yale Hirsch in 1972. Hirsch later developed the Stock Traders Almanac. In summary, if January performs well, then the rest of the year will perform well. This indicator has a reliability of 90% since 1950. Recent terrorism, global financial problems, and other things associated to the 2000’s have impacted this indicator, however it is still an indicator one should be aware of.
Lets take a look at the last few days of the SP 500 Index, see image below. You will see on Jan-2, huge above average volume, with the index closing up, occurred. It should be noted that this was the first trading day of the year, and instead of people entering with caution, worried about the future, people jumped head first into the market waters. This is known as “accumulation” and is indicative of large amounts of money entering the market. Then the index became quiet until Jan 15, then resumed the uptrend, with additional above average volume.
An analysis using my proprietary system indicates that the S-Fund should outperform all other funds this month. The month is not over yet, and things may change, but my opinion is that the S-Fund should lead the funds in performance. There has been occasional strength flashed by the I-Fund but this has not lasted more than one to three days. At the end of the month, you may indeed see I-Fund closely perform as well as S-Fund, depending on how things play out.
At the present time, I am 100% S-Fund. If you find this site useful or informative, please pass the word and tell your friends and coworkers about it. Also, thank you for the numerous emails and compliments which have been sent. Thank You.
– Bill Pritchard
