Safetyguy's Account Talk

[Safetyguy]

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In Safetyguy Account, you can see that I am 50S and 50I --



Despite my better judgment, I think I was late to the I Fund party -- bought high and may be forced to sell low(er).



Value of the Yen is up but the Euro is down today. Here is where the gamble part comes in. There is a good chance the Bank of Japan will sell yen to get it down to ~101 yen/dollar from its current >104. They did something like this in the last three trading days of 2003, maybe they’ll do something like that again soon.

 

[coolhand]

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I'm with you. I've read the talk about the BoJ possibly doing just that. I know some of us who jumped into the "I" this week (me included :shock are nervous about jumping in when we did. It is only an educated guess on my part, but the reason the dollar is where it is has not changed.Speedbumps obviously have to be expected. I'mstaying put for a little while yet (probably 2 - 3 weeks anyway).Just my thoughts. Good Luck!!!

 

[Safetyguy]

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coolhand wrote:

I'm with you. I've read the talk about the BoJ possibly doing just that. I know some of us who jumped into the "I" this week (me included :shock are nervous about jumping in when we did. It is only an educated guess on my part, but the reason the dollar is where it is has not changed.Speedbumps obviously have to be expected. I'mstaying put for a little while yet (probably 2 - 3 weeks anyway).Just my thoughts. Good Luck!!!

Well I think the Japanese stock and bond markets are now closed for the year (they have a holiday on 12/31 and 1/3) but it is good to see the Nikkei up a bit tonight.

Japan's currency fell to 141.36 per euro at 12:25 p.m. in Tokyo from 141.29. The yen was also at 103.85 per dollar, up from 103.86 yesterday.

Even though the Japanese markets are closed, this does not preclude the Bank of Japan from making a move. According to Bloomberg, "Finance Minister Sadakazu Tanigaki on Dec. 28 said Japan ``will closely watch the exchange rate'' during the holidays."

http://www.bloomberg.com/news/markets/currencies.html

Coolhand - I wish you didn't the term jumping in your post. I keep thinking of that scene in "Butch Cassidy and the Sundance Kid" where they jump off the cliff and yell "Oh sh..!!"

I guess since Paul Newman was Coolhand Luke in an earlier movie, you can be Butch and I'll be Sundance. Now Iwant to know who these guys are and why they are chasing our TSP gains. I guess we jumped off the cliff togetherinto the I fund this week. I'm with you on this-- let's see how it plays out in the next week or two.

 

[coolhand]

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Safetyguy wrote:

Now Iwant to know who these guys are and why they are chasing our TSP gains.

From the movie:

Butch: I think we lost 'em. Do you think we lost 'em?
Sundance: No.
Butch: Neither do I.



http://www.advfn.com/news_Forex---Dollar-loses-ground-after-weak-Chicago-PMI---UPDATE-1_9837301.html

​

 

[Safetyguy]

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Currently 50S and 50 I

As I start today, I really don’t know what to do. My technical indicators say it is time to start thinking about getting out of the S fund (and the C fund if I had any money there.) This of course means that sometime in the near future after these two drop, it may be a good time to buy into the C & S funds. I don't know what to say about the I fund. The MSCI EAFE Index looks like a strong place to stay BUT I fund investors have to worry about the value of the US Dollar as well.


As of 7:37 AM, S&P 500 futures are up almost 5.6 points and at 7:17 AM the value of the dollar to the euro is up 0.24% and the dollar to the yen is up 0.14% -- not too good for the I if the trend continues all day. I suspect traders and investors are doing some dollar selling because they think the sawbuck will drop further and/or the Bank of Japan will do something to get the yen/dollar ratio down.


So as the New Trading Year begins, the predictions are that the dollar will continue to drop. If it does there are two places to be – I fund and C fund. Why C fund you ask? If the dollar falls, the Small Caps who tend to be more US companies will be hurting more than the Large Caps who are very global and have hedged their bets with businesses around the world. Also, it has been six years that small caps have outperformed the large caps – incredible but is it reallysustainable for another year???


Over the next week or so, I would like to reduce my S holdings to 30% and move 20-30% into C. The rest will be in I. Timing is everything to ensure the maximum gain here.


I’ll check in before noon and decideabout making a change. If the EAFE Index is down 0.3 % or so and the value of the dollar is up, I might move more $$ into I. If the S&P is down, that is whereI move somemoney. Ifeverything is up, I probably will stay put.

 

[Safetyguy]

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My comments earlier this morning seem somewhat prophetic at noon. Too bad I didn't figure it all outbefore the TSPinterfund transfer deadline of noon last Friday. I guess I missed the signs because I was hoping for a good start to January.

Euro is down significantly in value compared to the dollar and the yen is too (but to a somewhat smaller extent). Who knows how this will play out on the closing price ofI fund shares today???

I have no choice but to ride out my current allocation of 50I and 50 S. I can't think of a move than won't cost me hundreds of dollars. No change for today.

Like Scarlett O'Hara said "Tomorrow is another day". If she were in TSP, she would have said "Tomorrow is another day if I can't get my interfund transfer in by noon Eastern"

 

[Safetyguy]

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Changed to 10C 20S 70I on01/04/05 @11:00 EST (before noon deadline, effective on 01/05/04

My analysis sez things may be bottoming out todaybut I am worried thatthe value of the yen is down but the euro is up.

 

[Safetyguy]

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Staying 10C 20S 70I



Someone tell me why S keeps dropping!!!!

 

[cowboy]

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Im guessing but I think we will hit support soon as C is holding. S may drop another .20 and then go up tomorrow.

 

[Safetyguy]

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Changed to 40C 20S 40I on01/06/05 @11:30 EST (before noon deadline, effective on 01/07/04

Just a reallocation to put more into C. Too much going on with the currency markets and I wanted to reduce my exposure in the I fund. All the TSP funds should be bottoming out and be rising soon (at leastI hope they will).

 

[Safetyguy]

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40 G , 20 C , 40 I @11:20 AM ET on 1/12/05



My level of pain in the S is too high – it has dropped over 5% since beginning of year. Lightening up on C but staying 40% in the I. Good to see Tom made a similar move.

 

[Safetyguy]

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Just to further explain the thought process --

I can't see anything in the technical indicators that say to me that I should stay in S (I looked at W%R, MACD, RSI, ROC, AROON, etc.). In fact, I hate to say it buteverything looks like it is saying get out of the Wilshire 4500 and S fund.

Looking at the same technicals for the C and the I --

They look better than those for the S by a long shot (and the EAFE is looking real good today). I think I may get back in S in a week or so but let's see how it goes first.

OK Tom cancelled his change right before noon and stayed in the market. I chose to goon the defense by moving 40% into G. If I am wrong,I lose some profit. If this was indeed a good move, I preventedsome of the"reverse compounding effect"if small caps drop even more. (Say I lose 10% of total value in my account. From my new 90% position, I have to make at least 11.1% to get back to my original starting positiom. This 11.1% doesnot count the amount to needed to match the positive return if I had left my originalamount in100% G fund while clawing my way back.)

What does everyone think of this rationale? For those who are technical traders, how are you interpreting the indicators?

 

[Safetyguy]

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20G 25C 15S 40I at 11:40 AM ET on 1/18/05



Sticking with my I allocation to see how the dollar exchange thingy pays off. I think 15S is a gamble but should be OK over the next week. I did think about being a contrarian and going a lot into F but my experience in F has always been bad.

 

[Safetyguy]

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Went 35C 30S 35I this AM (2/2/05) at 9:30 AM ET

The indicators that I have been using (W%R, RSI, MACD, Short/Long Term Moving Averages) tell me to get back into stocks. I might get whipsawed a bit because I panicked last week and went 60% into G. I am still hoping for a drop today after the Fed announcement (which is why I didn’t get back in yesterday).

I still can’t figure out why Namor and SystemTrader went 100% F today. I just don’t see anything that points to the F fund going up. Usually the W%R is a good indicator of what is happening in F – but it is showing a down trend right now. I hope you guys do well. It is good to see my buddy Coolhand get back to being a Bull – even though he is still hedging with 35% in G.

 

[SystemTrader]

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Safetyguy wrote:

I still can’t figure out why Namor and SystemTrader went 100% F today. I just don’t see anything that points to the F fund going up. Usually the W%R is a good indicator of what is happening in F – but it is showing a down trend right now. I hope you guys do well.

I'mstill in stocks today (including some funds in the S&P 500 in oneaccount). But I'll be out by COB.

As for why I'm going F, well, I guess my system looks at the world a little differently than most people/indicators. It will be interesting. We'll see what happens!

John

 

[Guest]

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SystemTrader wrote:

I'mstill in stocks today (including some funds in the S&P 500 in oneaccount). But I'll be out by COB.

As for why I'm going F, well, I guess my system looks at the world a little differently than most people/indicators. It will be interesting. We'll see what happens!

John

S&P? You have no allocation in the C? We back stepping? You guys crack me up.........

 

[Safetyguy]

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100G @11:50 EST on 2/25/05



I fund indicators look strong (for now) but I don't want to gamble. Could be a “dead cat bounce” in C and S right now and I hope it holds until the end of the day.

 

[coolhand]

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Safetyguy wrote:

100G @11:50 EST on 2/25/05



I fund indicators look strong (for now) but I don't want to gamble. Could be a “dead cat bounce” in C and S right now and I hope it holds until the end of the day.

Great minds think alike. Nice to hear from you again.

"C" and "S" seem to be holding their own right now and are moving rapidly upward (.72% and .67% respectivelyas I write this). The "I" is up .72% too. Nice time to sell in my opinion. :^

Let's hope it holds, but I think it will.

 

[Safetyguy]

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coolhand wrote:

Great minds think alike. Nice to hear from you again.

"C" and "S" seem to be holding their own right now and are moving rapidly upward (.72% and .67% respectivelyas I write this). The "I" is up .72% too. Nice time to sell in my opinion. :^

Let's hope it holds, but I think it will.

:^ Well Coolhand, it looks like we succeeded in banking some moolah. I'm getting close to making up for my January losses -- how about you?

I'm not sure ifwe were at the top of the price curve but I think it was a pretty close call. Seriously --look at thepattern in the W%R and RSI, we could be near the peak or the beginning of a prolonged upward trend.I'm looking for a dropin the next two to four days which might be a good time to get back in.If it doesn't drop, I'll put my tail between my legs and buy back in at higher prices (if I see an upward trend)

I alsoam pondering the best wayto play the C fund in March given the pending S&P 500 free-float adjustment. There will be some volatility here but maybe the market has already compensated for it.

 

[tsptalk]

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Anyone smartenough, or brave enough to jump into stocks last Tuesday or Wednesday got what they deserve. A nice gain!

Well done!