Sensei's account talk

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No time for a fancy chart right now, just a copy and paste of the S&P going back to 08/2010
big.chart

Take a look around late October 2010 - a plateau somewhat like what we are seeing now. It was followed by a huge spike. The beginning and end of December 2010 also saw periods of flat action followed by rallies upward. If this is going to be an extended bull market, our current flatline is healthy consolidation. If this is not really a bull market, though, we're forming a top and are about to fall off a cliff. My point? I don't see this as a good time to try and eek out an extra 2 or 3 percent with a deftly timed trade. I think you're either a bull and in for the long haul, or a bear and out until you either get your pullback or see clearer confirmation of a bull market. Like the 50 SMA crossing the 200 SMA. Incidentally, you can see that the Golden Cross of 2010 happened during that period of October consolidation. We're getting close to the cross now. Will history repeat itself?
 
If I remember right (I'll be corrected) the end of 2010 was very news reactive.
 
Here's a blast from the past:

big.chart

There were actually quite a number of down days during the last bull market, but as you can see, the subsequent buying was always stronger than the selling, and the trend pushed higher and higher. 300 points in six months. They say the trend is your friend. If it rhymes, it must be true.:toung:

The longest string of down days was 4. Most pullbacks only lasted 1-3. We still have 6 trading days left in January. Even with a 3-4 day pullback now, price could easily be back to where it was yesterday - or even higher - by February 1. With only 1 IFT, I'm looking to trade my C for S with any weakness.
 
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sensei
konnichiwah (sp):D that is a good chart which points out some good indicators. im all in and debating whether to stay today or take some off. leaning toward the latter since i have been in for a loooong time riding the ups and downs. or maybe i should keep on riding since i have been long this long(pun intended). what would the MB do? looks like alot of S funders are stayn in locking in that 4th place autotracker traffic jamm. any thoughts are welcome.:)
 
Sensei,

You are on the right track with your Sharebuilder account - DCA slowly and use time to build your base. I owned the originally Sharebuilder when it was part of Merrill Lynch back in the late 1970s. If you own individual stocks the dividend reinvestments really add power over time.
 
Thanks Birchtree - I appreciate the vote of confidence, and your willingness to share your own investment experiences. I definitely believe in the get rich slowly approach, and hope that someday I'll have a couple "oceanic" accounts to pass on to my children and their children.:)
 
Sensei said:
Thanks Birchtree - I appreciate the vote of confidence, and your willingness to share your own investment experiences. I definitely believe in the get rich slowly approach, and hope that someday I'll have a couple "oceanic" accounts to pass on to my children and their children.:)
Click to expand...


I used Sharebuilder for a long time and it worked well for DCAing (Automatic Investment Plan) into positions. I was grandfathered into a much more low cost program that allowed me to make very small mutual fund purchases every Tuesday...very nice for a grad student wanting to continue slowly building accounts. I only invested $40 every two weeks, but it adds up!!

I recently got away from mutual funds entirely and have moved out of SB to consolidate all of my brokerage accounts under one roof. One thing I got burned on once w/ sharebuilder was the 90 day hold on mutual funds. I made a rookie mistake once and tried moving everything to "cash" to sidestep a market drop and got hit with a load of fees because of my recent purchases through DCA (auto investment plan).
 
Mapper said:
I used Sharebuilder for a long time and it worked well for DCAing (Automatic Investment Plan) into positions. I was grandfathered into a much more low cost program that allowed me to make very small mutual fund purchases every Tuesday...very nice for a grad student wanting to continue slowly building accounts. I only invested $40 every two weeks, but it adds up!!

I recently got away from mutual funds entirely and have moved out of SB to consolidate all of my brokerage accounts under one roof. One thing I got burned on once w/ sharebuilder was the 90 day hold on mutual funds. I made a rookie mistake once and tried moving everything to "cash" to sidestep a market drop and got hit with a load of fees because of my recent purchases through DCA (auto investment plan).
Click to expand...

Good to know, Mapper. I don't plan on selling anything until I have at least $1000 worth of it, as it will cost $8 for the transaction. I have 8 stocks and 2 ETFs, and I figure it will take me about 3 years to get them all up to that value. Even then, I'll probably just hold on to what I've got and add some more of BT's dividend paying "wallflowers". I look at it as a savings account with more risk/reward.
 
Re: Sensei's Account Talk

NHK's reporting a possible coup d'etat in Pakistan, WSJ Asia shows the prime minister of Australia getting roughed up by angry locals, Yahoo! has Newt Gingrich planning out space colonization in his second term... it's a mad, mad, mad, mad, mad, mad world. But I guess it always has been, we just get it in real time now with the internet.

Today was the last day of the first semester at my school. Half way to summer vacation! :D:cool: Gotta do grades tomorrow. :notrust:

I'm still hanging in 50C/45S/5I. I'm directly above the C fund on the tracker, despite only being in 28% on the first day. Still would like to dump the C for S, but I'd rather do that during a pullback. It's looking quite bullish out there. The early returns on the SS are looking like it might tip to a sell. The LMBF, on the other hand, is looking like it will probably stay in stocks (S). Could get very confusing over the next couple days.:worried:
 
Re: Sensei's Account Talk

Well I hemmed and I hawed all month, and last night I finally pulled the trigger on my 2nd IFT. I moved to 95%S, 5%I. Couldn't stand watching my 50% in C underperform anymore. Of course, as soon as I submitted the IFT, I had buyers' remorse, because even though I already had 45% in S that I purchased back on January 4, by moving the other 50% in, I'm pretty sure that TSP just sells all the shares and repurchases them at today's price. So I guess I reduced the number of shares that I owned with that original 45%. Oh well, too late to do anything about it now.

My primary reasons for making the IFT now - SS issued a fresh buy signal, and I'm kind of front-running the LMBF method, which I think will move to S. I fund could surprise in the next two days, but even if LMBF were to move to I, I would go to S. I don't trust I with more than 5% of my money.
 
Re: Sensei's Account Talk

Sensei, I don't know if they would sell the shares you have and then rebuy, but even if they did, you would be selling and buying at the same price, so you would still have the same number of shares with the money that was already in S... ie - buy 10 shares for $5, shares go up to $10 and you sell ($100), then buy back in at $10 a share, and your $100 would buy you 10 shares.
 
Re: Sensei's Account Talk

daze823 said:
Sensei, I don't know if they would sell the shares you have and then rebuy, but even if they did, you would be selling and buying at the same price, so you would still have the same number of shares with the money that was already in S... ie - buy 10 shares for $5, shares go up to $10 and you sell ($100), then buy back in at $10 a share, and your $100 would buy you 10 shares.
Click to expand...
Right - thanks for straightening me out. Math isn't my strong suit, which is probably why I'm a foreign language teacher. :embarrest:
 
File this under "FWIW":
big.chart

In the last decade, any time there has been a "Golden Cross", the bull market has continued for several months - if not years. Though there have been a few fake "Death Crosses" (not actually resulting in a bear market of more than a couple/few months), there have not been any fake Golden Crosses. In 2005-6, buy and hold would have given you a lot of acid reflux, but a positive return at the end of the year.

If one had the patience and discipline to step out at the Death Cross in late 2007, and not re-enter until the next Golden Cross in mid 2009, imagine the discount.
 
Looking for the 31st and 1st to go green and validate my holding stocks for the whole month of January. I like to think of the 1st of the month as part of the previous month b/c if you've used one of your IFTs to get in at any point, and you go to cash at any point, you will need to wait until the second trading day of the next month to get back in. So, for the most part, the 1st is really the last day of the previous month for us TSPers.

I like that the SPX went down to kiss the 20 day SMA then scratched back, leaving a nice long kangaroo tail underneath. We should move higher from here. I'll have to go back and check the charts to see how often the 20 day acted as support vs. the 50 day in the previous bull market.

I'm thinking from here we'll climb to maybe 1340-50 before the next pullback. Hopefully it happens mid-month, and I'll be able to jump out and back in. Don't want to risk missing the gains though. Maybe better to be a bull and ride out the pain now.
 
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Hope you are right...we should know in the morning (hopefully before deadline) if you are right or wrong. I agree with the 1350ish mark but I see an equal chance of 1282ish (and... hopefully for my part as that is when I got out... 1265ish)! Maybe Tom will have an answer for us when we get up.
 
Here's looking back at that previous bull market:

big.chart

You can see that the 20 day SMA was really strong support throughout - except for one noteworthy correction down to the 50 day SMA. The second time the 50 was tested was the rally killer. Look how tricky it would have been to predict though. Market drops to the 20, you say "OK, let's give it a day or two. It bounces on the third day and you think, "all right, back to the rally." Then down, then up, then down, then up, then suddenly you've lost several months of gains and you sell in a panic. Only to see the market rise again for the next couple months before dropping off a cliff (what comes after this chart.) Buy low, sell high. Easy, right?
:embarrest:
 
Sensei said:
Here's looking back at that previous bull market:

big.chart

You can see that the 20 day SMA was really strong support throughout - except for one noteworthy correction down to the 50 day SMA. The second time the 50 was tested was the rally killer. Look how tricky it would have been to predict though. Market drops to the 20, you say "OK, let's give it a day or two. It bounces on the third day and you think, "all right, back to the rally." Then down, then up, then down, then up, then suddenly you've lost several months of gains and you sell in a panic. Only to see the market rise again for the next couple months before dropping off a cliff (what comes after this chart.) Buy low, sell high. Easy, right?
:embarrest:
Click to expand...

Yeah, I made 15% as a B&H in 2010. Was barely positive last year and this year is looking volatile too... I hope I can eek out some gains over the next few months.

Good Luck Sensei!
 
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