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Hello

Today, Monday June 24, witnessed another volatile day as the world worried if the patient would breathe on his own, after it was discussed last week by Ben Bernanke that the breathing machine would be disconnected in the future (see my earlier analogy reference this example).   The markets closed down on above average volume.

It is my opinion that a move to the G-Fund is in order, to reflect 100% future contributions and 100% of your account balance, to be shifted to G-Fund.

Me, personally, I am still a cheerleader of our economy (the recovering “patient”) and believe things are slowing turning around, and have my own facts to prove it.  However that does not mean I am going to try to catch a falling knife, and it is my opinion that a precautionary move should be made to G-Fund.

I might add that I have struggled with crafting this post, as my feelings about the overall economy and long-term stock market are very positive, however trading and investing on emotion is an amateur mistake, and I had to remind myself to step back, look at the market itself, and pull the trigger accordingly.   Unfortunately, we have had some down days and we need to protect our account balances.

On that note, I invite everyone to take a look at this 06-24-13 video, courtesy of CNBC, in which Rick Santelli is interviewed.  The short version is Santelli’s position is that the market is going to do what the market is going to do.

I am moving my balance and future contributions to 100% G-Fund.  Thanks for reading everyone…hopefully these storms clouds clear up in a few weeks.

– Bill Pritchard

In the “other news” category, I wanted to post an update to a very important project that has been in development.

On June 18, 2013, the San Angelo, Texas City Council approved the renaming of Rio Vista Park, to Jaime Padron Memorial Park, to honor USMC veteran and Police Officer Jaime Padron, who was killed on duty, in 2012.

Video Link is at http://www.youtube.com/watch?feature=player_embedded&v=zQSUYXfLJq8

Please scroll to 0:29:23 in the video and hit play, to view the City Council discussion of this project.

Below, is a Google Earth image of the park, which is under renovation and when work is completed, will be re-opened under Jaime’s name.  I will be there in July and will take some pictures of the ongoing renovation efforts.

This project was the result of many folks coming together and working towards a common goal, and as the initiator of this important project, I can’t say enough thanks to the great people in the San Angelo City Council, specifically Mr. Johnny Silvas, of Single Member District 3, Matt Baldwin, Brian Bylsma, and Johnny Padron.  Thanks to Austin Police Chief Art Acevedo for his tremendous support.  These great folks were the reason that this was successful.

Thank YOU

– Bill Pritchard

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Hello everyone

Today, Ben Bernanke stated that the Fed would likely start reducing its stimulus program.  Markets closed down on above average volume, but above key trend lines.

I want to allow this week to “close out”, after which I will take a look at things and share my insights early next week.   I might add that markets typically panic for a day or two, then re-stabilize, when bad news is released.

NOTE:  My position is that the US Economy is a hospital patient, hooked up to life support (Federal stimulus/QE programs).  Well, the patient is starting to get healthier, and it may be time to remove life support and allow the patient to breathe on his own.  This is good for the patient, not bad (allowing him to breathe on his own).   The patient will cough and moan and probably ask for that machine again, but big picture, if the patient starts breathing on his own again, and continues to do so, the patient will be stronger and better-off.

During the window of time, between when the doctor’s fingers hit the “OFF” switch on the machine, and when the patient starts to breathe unassisted, during this transitional period, the onlookers in the room will be worried, nervous, and probably praying.   Right now, today, we are in that period.

I had dinner with a fellow subscriber last night who was TDY to my city, and this topic came up.    My explanation sounds a little corny, I wish I could produce a Princeton PhD dissertation regarding financial friction and macroeconomics (someone else wrote it) , but my explanation gets the point across.

Lets see how the week finishes up, and expect another update soon.   If you find this site useful or informative, and it has materially impacted your Thrift Savings Plan (TSP) performance, I ask that you share it with your friends and coworkers.  I can’t place advertisements in the Wall Street Journal, and rely on word-of-mouth for building my subscriber base.   Thanks for reading

– Bill Pritchard

TSP Allocation:  100% S-Fund but monitoring things closely over next few days.

Hello and Good Evening to everyone

The month of May is behind us, and while a few of you have emailed me regarding the “Sell in May” strategy, I advocated that we let the market tell us what to do, and respond to the market itself.  It is very hard to “outguess” the market.  My investing methodology can be categorized into the Trend Following category, and this past month was a good example of why this strategy tends to be successful.

It should be noted that the SP-500 Index closed at 1582.70 on May 1, and on May 31, closed at 1630.74.  This represents a 3.0 percent gain in May on the index.  In today’s turbulent market climate, I am happy to take any gain the market gives us.    Please see below table representing the official TSP site monthly returns.

As can be seen, the top fund for May 2013 was the S-Fund.  It should be noted that the I-Fund was down -3% for May.  This is while the US Indexes were generally all positive.  Some may recall my observations regarding the I-Fund, observing that its April performance may or may not have been sustainable.  The I-Fund is a weird animal, much more susceptible to international politics and global economic turbulence.   This can at times put tremendous gains on the table, and sometimes take them away.  The I-Fund sometimes runs in sync with US markets, and sometimes it does not (as shown by May’s behavior).   This is not a “knock” against the I-Fund…however at times the I-Fund requires that your seat belt be tightened a little more than if you are in the S/C Funds.

June opened up on a positive note, with the indexes performing very well on June 3, 2014, closing higher than the prior day, on slightly higher than average volume.  I would have liked the volume to be a little higher, but I will take what I can get.  On June 4, 2013 however, some nervousness about the Federal Reserve’s low-interest rate and bond buying programs (aka QE or Quantitative Easing) have caused the markets to go lower.  One June 4, the SP-500 closed lower than June 3, on average volume.   No “high volume sell off” occurred on June 4, nor did it trade lower than its low of June 3, which was 1622.72.   However, we still need to monitor things and keep the trigger finger ready for G-Fund if the situation dictates.  See chart below.

As a counter to this, Big-picture wise, we are seeing positive news reports regarding the economy, involving reports of rising home prices (indicating buying, versus selling of homes), reports of rising car sales, and other things.  In summary, I am not (not yet) going into panic mode over the Federal Reserve market nervousness….I see other positive signs regarding the economy.

At 10:15 PM Central Time June 4, the SP-500 evening futures contract found support and did not trade below the daytime session.  This usually (but not always) foreshadows what will happen on the next day’s stock market trading activity.  See chart:

Once again (not bragging, but….), this site provided accurate insight into the best performing fund.  Since January, I have expressed my opinion that the S-Fund is the place to be, barring the move to G-Fund in April, due to North Korea’s threat of nuclear war.  However, most can agree that since January, this site has provided accurate and informative guidance into the funds, ten of which exist, and almost every month since January, I have successfully called the top fund, out of ten potential choices.  An internet search will reveal many “TSP advice” websites, mostly all subscription/payment based.  This site has likely outperformed them all (to my knowledge) and is free.  If you find this site useful, please pass it to your friends and co-workers.  Thank you for the interest and the numerous positive emails.

Thanks again for reading….

– Bill Pritchard

TSP Allocation:  100% S-Fund

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Hello everyone

As most of you know, May has been a great month so far for the markets.   All of the indexes are performing very well, and my preliminary proprietary data is reflecting that S-Fund will be the leader for this month.   Today is May 22, so that leaves us with six (6) more trading days in the month.  It should be noted that the markets are closed on Memorial Day, May 27.

Today witnessed some nervousness in response to the release of the recent Federal Reserve Board meeting minutes and testimony by Ben Bernanke to members of Congress.   In summary, Ben Bernanke told Congress that the bond buying program in place, may slow, and that monetary policy may become tightened in the future.

As a result, the SP 500 Index closed lower, on very high volume.  However I don’t believe this is reason to panic, as the evening SP 500 futures trading indicated that “traction” was found and the futures were trading higher than the day session lows.   See charts below:

Again, I am not overly concerned about the nervousness surrounding the monetary policy, but in the end, we must let the market tell us what to do.  For now, things are still good but today’s downward price action on high volume is an attention-getter.   It will require that we closely monitor things in the weeks to come.   Note that Friday May 24, will likely be a low volume day, due to traders on Wall Street not being at work, having left early for the long weekend.  So whatever happens Friday, should probably be disregarded.

My opinion is that the economy is on the rebound and things are looking positive.  My personal TSP Allocation is 100% S-Fund.   At this point, 100% S-Fund or 50% S-Fund and 50% C-Fund would both be fine.

I wanted to say “thanks” for all the emails and compliments sent.  As always, if you find this site useful, and/or your TSP balance has benefited from the information posted here, please pass the site to your friends and coworkers.

Thanks for reading….

– Bill Pritchard

Good Evening Folks

I am TDY on my MacBook Retina, and while this $2000 laptop is a marvel of engineering, the owner (me) can’t figure out how to cut and paste graphics into my site.  I forgot my mouse and am using the trackpad.   My apologies….

Skipping cool graphics and charts, for now, I am happy to see that May is off to a great start.   The SP 500 is above 1600, and things are looking “up.”    The official TSP monthly returns are in, and the I-Fund knocked it out of the park for April and I-Fund was the best performer for April.  The Year to Date best performer is still the S-Fund, but as the other funds start to demonstrate life and energy, we need to monitor those funds closer.    May got started with C-Fund and S-Fund outperforming I-Fund however.   So the April burst of life for I-Fund may (or may not be…) be an isolated burst of life.

I would like to present the following video, from CNBC, in which NetJets Fractional Jet program is profiled.   In this video, Warren Buffett is interviewed, along with NetJets CEO Jordan Hansell.   While Warren is not really a “stock investor” per se, since he buys entire companies, and turns them around, obviously if Warren talks then it would be probably be smart to listen at least a little bit.  I believe that NetJets is a good barometer for the economy because while many owners are wealthy individuals, who have ownership in NetJet aircraft who travel to Aspen and ski, many are corporations that are “up and coming” and prefer not to use airline travel, but cannot write a check for a $40M Gulfstream.  NetJets bridges the gap and fulfills a corporate/executive travel solution.

It appears that NetJets business is coming back, and this is reflective in my opinion, of the economy.   This is consistent with my own travel observations (I was on the road approximately 200 days in CY 2012), that private aircraft ramps are becoming more crowded and business-oriented hotels such as Marriott and Hilton are seeing less availability of rooms due to increased business travel.  These, too, are reflective of the economy, in my opinion.   Full hotels and lots of private jets at airports are not reflective of a pending recession, I guess that’s my point here.  Lets take a look at the video:     VIDEO LINK

That’s all I have for now, I am 100% S-Fund at the present time.  This may change depending on how the other funds perform this month.

Sorry no cool graphics…..forgot the mouse…..

Thank you for reading

– Bill Pritchard

Hello everyone

Doing some market analysis tonight…the main “headline issue” and great news is that today, 04/30/2013, the SP 500 index hit a historical, never before touched, all time high, closing (closing price is always better than intraday price activity) at 1597.57.   See chart below with comments.

This month, the I-Fund has had some bursts of life, and April TSP data will possibly reflect the I-Fund as the April top performer, however this is not necessarily a reason to switch to I-Fund.   This does however require that the I-Fund be monitored for continued positive performance and after everything is assessed, we can entertain a possible move.  S-Fund and C-Fund are doing well also, and I am personally still 100% S-Fund.

I should add that the “general public” is still skittish about returning to stocks,  however as this market uptrend (hopefully) continues, people are going to want some of the action and ease back into the market.  At that point, the trend (as people enter the market, having been in the bleachers watching things…) will then likely grow even stronger.

Again, today witnessed great news, in the form of the historical all time high in the SP 500 Index.  The occurred on slightly above average volume, I would have preferred a little more volume, but I will take what I can get right now.

I remain 100% S-Fund and will be monitoring the I-Fund.

Also, please see FAQ section as many have sent me some valid and great emails this month and I put some in that section.

Thanks for reading, and if you find this site and the updates useful or informative, please pass the word.   Thank YOU

– Bill Pritchard

Hello everyone

The markets have rebounded from last week’s dismal performance, which was arguably caused by the tragic events surrounding the Boston Marathon, poor economic news from China, and other factors.

As we know, the suspects in the Boston Marathon incident are either dead or in custody, due to the great work and cooperation between members of the public, and our law enforcement and public safety community.   There is no doubt that their quick capture/demise “sends a message” to the world, and as we finish up this week’s trading, the markets have (not surprisingly) rebounded, as uncertainty and questions regarding the Boston incident are now able to be addressed.

Some have emailed me and asked me why I did not panic regarding last week’s downtrend.  As most of you know, I use a combination of fundamental and technical analysis, combined with historical “look back” at similar events and situations when I see the market begin to stumble.   One of my tools in my “toolbox” is the use of Moving Averages, which in simple terms is a moving trend line which responds to the price activity of a stock or index.  A very popular Moving Average is called the “50 day Moving Average“, and my backtesting and research reflects that as long as a stock or index closes (not intra-day price behavior but closing price) at or above this line, then the trend is likely to remain intact.  Multiple closes below this line is a warning sign (coupled with other data and information prior to pulling the sell trigger).  My use of Moving Averages was documented in an article written by me, published in the January 2006 issue of Technical Analysis of Stocks and Commodities Magazine, which is sold nationwide at Barnes and Noble.

Lets take a look at the CLOSE ONLY price performance of the SP 500 last week.   See charts attached.  First chart is normal price chart, showing high, low, and close, second chart is close only with no comments, second is with comments.

As we can see via the above charts, the same information becomes more clearer depending on how it is viewed.   Time allowing, I like to use “close only” charts when we hit speed bumps in the road, and by combining this with other data and information, I am typically able to make a decision and rest better knowing the decision was made with all available information.

On April 13, 2013, I posted some commentary regarding the Boston Marathon bombing and how the market may respond.  In support of that post, I went back to some historical events, to include the 9-11-2001 attacks.   The markets at that time (let’s remember, behind the markets are people and emotion) responded initially with a downtrend, then rebounded strongly and went up.   So my crystal-ball (which rarely works but I still keep it on my desk….) told me that unless human beings got reinvented and the new 2013 versions of humans on Wall Street did not have fear, greed, panic, hope, etc running through their veins, then the market response to Boston would probably be similar.

It turns out that my crystal ball decided to work, as a look at chart one above, shows an apparent “U turn” or reversal to the downtrend and an apparent resumption of the uptrend.    Time will only tell if this uptrend continues.  We are seeing some resistance in the 1575-1585 area.   Most will remember that 1576 is the prior all time high, dating back to 2007 (already penetrated), and is still recent enough to be a significant area, and any close above 1576 is a positive.  1597 is the newest recent high, achieved on April 11 2013.  Anything above that represents new territory and further confirmation of the uptrend.

On 04-25-13, the SP 500 climbed thru the 1575-1585 resistance area and was able to hit 1592 intra-day, before closing at 1585.   So we are seeing some definite attempts to get up to new high territory.

If all that sounds like Greek, in summary, any SP 500 price action above 1576 is good news, and as of now, the the next goal is price action above 1597.  Anything below 1570 is indicative of sickly performance and this will require close monitoring of the index.

I continue to advocate to use the SP 500 Index as a “big picture” view of the markets.  Some have emailed me, asking why I don’t use NASDAQ or the Dow.  The NASDAQ is susceptible to being driven lower by major NASDAQ members such as Apple (AAPL), which has suffered some setbacks to its stock performance in the last few months.  However just because AAPL is going down, does not mean that the entire stock market is going down.   The SP 500 is 500 stocks and in my opinion offers a better assessment of market health.

With that said, I am still 100% S-Fund, as it appears that the S-Fund will perform best this month (or “least worst” given the various market issues this month).

Thank you for reading.   As always, if you find this site useful or informative, please forward this to your friends and coworkers and encourage them to sign up for free email updates.  Thank You

– Bill Pritchard

NOTE: This Post was originally going to be published April 15 but I then decided to wait for the markets to open and close on April 16 and then assess things.

On April 15, 2013, the markets closed significantly lower, which most have theorized is a “panic response” to the unfortunate tragedy surrounding the Boston Marathon.  Shortly after 2:30 PM, the SP 500 ETF, SPY, traded an abnormally high number of shares to the downside, adding credibility to this theory.   It continued lower until the market closed.

This type of event, is considered a Black Swan Event, a concept discussed by Nassim Taleb.   This type of event is unpredictable and sudden.

Evening SP 500 futures found support, and did not trade lower than the prior daytime session.   This is somewhat reflective that calmer minds came into the picture and bought SP 500 futures (versus sell them).   Typically, the evening futures market is predictive of the next day regular stock market, which will be 04-16-13.

I feel it is important to take a look at the SP 500 index, going back to Sept 11, 2001, the worst act of terrorism on US Soil.   See below chart

It can be seen that after the initial panic response to this major terrorist event, the markets subsequently rallied, which would be a response not typically expected.   It should be noted that the market subsequently did crash, but this is not associated to 9-11, but to larger problems which existed big-picture, as most will remember many “stock market scandals” during the 2000-2002 era, such as Enron, WorldCom, Tyco, and others.   So 9-11 did not cause the markets to crash, and as noted here, once things calmed down, the markets rallied after 9-11.

Lets take a look at tonight’s SP 500 futures, as of 10:20 PM Central time 04-15-13.   You can see how the futures have “found support” and not traded lower than the day session.

On April 16, the markets rebounded, likely due to people reaching some reasonableness from a trading standpoint with the Boston Marathon situation.   All indexes rebounded strongly, with heavy volume and the indexes closing up.  Mid and Small-Cap stocks responded best on April 16.

The SP 500 closed at 1574, which is slightly below its previous all time high of 1576 set in 2007.   While the markets remain volatile and sensitive, I am remaining 100% S-Fund for the present time.

Thank You  – Bill Pritchard

Good Morning folks…

I say good morning because my computer clock says 01:20 AM, and once again I can’t say how cool it is to get the emails that I get from you guys.  We have a few talented “market watchers” in the audience, I had some of you tell me the SP 500 hit a new high.   Guys, I don’t want to sound corny but that is awesome.  Well at least I think so anyway.  Lets take a look at this weeks market action.

As everyone knows, on April 6, 2013, almost one week ago, I advised everyone that I was making a move to G-Fund, due to market behavior and the North Korea situation.   I am now moving back to S-Fund.   Here are my reasons.

1.   Maybe just me but I get the sense that the world is growing weary of North Korea’s statements and threats and the world is resuming their regular programming.

2.  The SP 500 itself is making new highs.  At the end of the day, don’t argue with the markets.

3.  The S-Fund is still the top performer, however on 04-11-13, the I-Fund really performed well.   Lets see if this is a one-day thing or maybe the start of something with I-Fund.  C-Fund is closely trailing S-Fund.

Please see below charts with notes on the charts themselves

Last week, we had some definite “yellow caution lights” which were 1) the market itself displaying some distribution days, 2) saber-rattling in North Korea, and 3) a couple of economic reports which didn’t help people’s moods.   While everyone loves gains, nobody likes a loss, and I am very loss-aversive regarding my TSP balance.   If I can keep the damage down to a minimum, then the scoreboard will take care of itself.   But if I recklessly pursue gains, I stand the chance to get hurt.   We had some nice gains Jan/Feb/March, so I prefer not to just throw those away.  Maybe I am rambling and I need to sleep but I think you see my perspective.

With that manifesto said, I will be moving 100% to S-Fund.   The markets have apparently resumed their uptrend, with the SP 500 penetrating the 1576 level, making new highs.   This is a milestone event.

In other news, some may have seen reports that PC sales are at all time lows.   As most know, the Macbook / Mac computers are not classified as PC’s.   With the popularity of Apple products, and Android tablets and devices, the PC just is not the hot thing anymore.  I predict demise for Microsoft (whose Windows 8 OS has received poor reviews) and related problems for antivirus vendors, who primarily service the PC market.   Apple products reportedly does not need antivirus but I am sure that will change.   This bad news hit the NASDAQ index, and dragged it down somewhat.

As a MacBook Pro Retina owner for travel, and Windows 7 Pro owner at home, I have to vote for Apple.  Dealing with Windows updates, firewalls, blue screens of death, etc etc just isn’t fun, not when the Apple just works.   When I have to become a semi-PC hacker and change system registry settings just to get Skype to work or so a Security Pack update will install itself, then what happened to the concept of ease of use for the customer.   Its not a shocker why Apple is taking the lead.

Thanks for reading

– Bill Pritchard