Transfer 6/10 for 6/14/04

[tsptalk]

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tsptalk wrote:

tsptalk wrote:

Getting more invested in stocks for tomorrow (Monday). My new allocation will be...

40% C, 40% S and 20% I.

I wish I had seen the recent AAII Investor Sentiment Survey before I made this new allocation. I'll blame it on Vegas again as I am out of my normal routine.

The reason is because the bearishpercent (those thinking the market will go down)went down to 16% while the bulls (positive on the market) went up to to 55%. This is nearing levels near pullback zones. Because of this I will be very quick to put some back in the G fund next week if we see weakness (or excessive strength).

Remember, too many bulls is BAD for the market. It doesn't mean the market will automatically go down, but it's another indicator getting a little frothy. The herd is usually wrong at tops and bottoms. I acted as part of the herdtoday. Rolocalled us on it the other day I think. Smart.

Tom

Yup. The herd turnedtoo bullish last week. Wish I saw that earlier. I'm not sure what I would have done but this decline makes sense now.

This decline along with the historically stronger options expiration week kept me from making a move. Staying invested for now.

Tom

 

[tsptalk]

imported post

tsptalk wrote:

Getting more invested in stocks for tomorrow (Monday). My new allocation will be...

40% C, 40% S and 20% I.

I wish I had seen the recent AAII Investor Sentiment Survey before I made this new allocation. I'll blame it on Vegas again as I am out of my normal routine.

The reason is because the bearishpercent (those thinking the market will go down)went down to 16% while the bulls (positive on the market) went up to to 55%. This is nearing levels near pullback zones. Because of this I will be very quick to put some back in the G fund next week if we see weakness (or excessive strength).

Remember, too many bulls is BAD for the market. It doesn't mean the market will automatically go down, but it's another indicator getting a little frothy. The herd is usually wrong at tops and bottoms. I acted as part of the herdtoday. Rolocalled us on it the other day I think. Smart.

Tom

 

[tsptalk]

imported post

So why did I go to 100% stocks again? I'll be brief here andwrite more about this in Monday morning'scomments, when I'm back home and have access to all of my data.

We are very overbought and it would seem a better time to be out of the market. But the more we expect a pullback, the longer it tends to take to come. The drop the other day is probably going to draw in the ones who had missed the boat recently and are looking for a reason to get in at a lower price. This type of action may keep the market afloat for a few more days. Once we see that "I guess we are not going to get a pullback" attitude, we are more likely tosee it. The market loves to frustrate and confuse.

Seasonality is another reason. I will post the June seasonality chart here once again. You will see we have another week of average or above average days ahead of us (percentage of time positive-wise). Today is the 8th trading day in June. It wouldn't be until the 14th trading day of June, which with the new holiday would be Monday June 21st, that we see some quite below average days. Thatweek of June 21st looks pretty bad.

Courtesy of http://www.sentimentrader.com

Of course these charts are nowhere near perfect, but if you are looking for a little guidance, an old trend can help you make a decision. I am getting a little aggressive to try to squeeze out some gains before that historically bad string of days. Why those days are below average, I don't know. Maybe those are earnings warning days - just a guess.

Anyway, I'm just hoping the market climbs this wall of worry for a few more days while it drags in the last fewholdouts to thisbull market. Once it has everyone, sentiment says that is when we will see more pullback.

I'm still very bullish for the rest of this year. I want to error on the side of being too bullish, so even when I take some off the table in a few days, I will keep at least 60% in stock funds.

Tom

 

[tsptalk]

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Yeah, sorry. The Vegas heat is getting to my head. That will be effective Monday morning. We'll get today's fund closing prices.

 

[bud]

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According to the WSJ...tomorrow (June 11) all the markets will be closed. If you made a transfer this morning, I would think it would go into effect Monday...is this correct?

 

[smine]

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Market is closed tomorrow.

 

[tsptalk]

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Once again, I apologize for the late notice. Next week I'll be back on track...

Getting more invested in stocks forMonday, 6/14. My new allocation will be...

40% C, 40% S and 20% I.