Time to Pay Attention

Hey! Well, it’s time for another blog post. I was sort of hoping that my next post was going to be in January but obviously, no such luck. I enjoy writing an entry once per year, that suggest that my market timing operation is actively filtering out most of the noise.  I have seen several tops and bottoms over the years, just as you have. Remember the bottom of 2009? the top of 2007? The 2000 top and the 2002 bottom? I saw them and called them all.

Major bottoms and major tops all have somethings in common and the markets want you to know about it and they use what I call the language of the markets. Markets speak a language all their own and if you can understand what it’s telling you, then you know that the market tells you what it wants to do.  Buy me! Sell me! It’s that code that you have to decipher.

Any freely traded market speaks this code or language. Buy me! Sell me! No time frame is an exception. To that end, if the market is not telling you to buy or sell then by its silence it’s telling you to stay your current course. It may take a dip here and there, it may pop here and there but you have to be able to ignore the noise and concentrate on the message.

This market, in my understanding of its language is telling me it’s time to divest myself of stock.

Remember, there is only one vehicle that we as retail investors should be invested in at any given time. That is either no-load mutual funds of stocks, bonds or cash. One of these 3 will general outperform the other 2 during certain economic conditions.

Famed market wizard and trader, Jesse Livermore once said “Profits always take care of themselves but losses never do”. It is your responsibility to make sure that a small loss does not turn into a large loss.

As of this writing, the Wilshire 5000 which is an index that represents the entire U.S. stock market, has returned an approximate negative 4%. In my timing operation I try to avoid noise and only pay attention to what presents itself as a potential and substantial retracement or drawdown.

The Dow is showing a return of negative 3%, down from a high of positive 9% earlier this year which basically means you lost all of your 9% gain from 2018 and then you lost 3% of the coin you stacked up in 2017.

What am I going to do, you ask? I will as soon as possible, get flat the stock market. I will move 100% of my long term invest money from stocks and into a no-load, money market mutual fund.

Using the Dow as my benchmark, if I’m wrong, then I’m wrong for about 9%. If I’m right I could be right for 40, 50, 75%. A small price to pay so I gotta take the shot.  If you would like to know exactly how I make my calls or how to make the play, just ask me.

That’s all for now, I’m not telling you what to do, I’m telling you what I’m doing. I’ll post again when it becomes necessary.

Happy Holidays!

What a year, uh?

The total U.S. stock market has finished the year with a rock-solid return.  That should come as no surprise to anybody because I told you we were moving higher.

On the other hand, 2017 was just chocked full of anomalies, not the least of which was the 2016 election (yeah, I’m calling that as part of the 2017 ‘thing’).  Oh wait, then Bitcoin and then CME launched Bitcoin futures!! Now I’m told to watch for the possibility of a new asset class in 2018: Derivatives on cryptocurrencies!!! (notice how the number of exclamation points increased with what I think is the absurdity of it all) That’s just weird.  I won’t be trading those because of my lack of confidence in the underlying.  Before you trade Bitcoin derivatives you should believe in Bitcoin futures and in order to believe in Bitcoin futures you need to believe in Bitcoin. Yeah, yeah, I know.  You didn’t come here to hear this, you came here to hear what I plan to do regarding my long term investment portfolio, well, here you go.

First, if you have been 100% invested in the total U.S. stock market, as I have, your 2017 return is approximately 20%. Nice.

As you know, I’ve been long this market since March 2009, when I called the bottom, coming off the crash of 2007.  If you have been long without fail since 2009 you are currently enjoying a return of about 367%. Not too shabby.

What do I see going forward? Additional growth.  I will continue to Dollar Cost Average any long term (retirement) investment money into a no-load, stock market mutual fund that mirrors the Wilshire 5000.

I will continue to do this until the market issues a sell signal and will deal with that thing then.

Happy and Healthy 2018 to you and yours.

This Will Be A Quick Post

I think the first thing you have noticed is that I've moved away from regularly posting at specific time intervals.  I've decided to do away with that practice because it is not very useful.
What we are most concerned with is when we should be in the market and what market to be in.

Therefore, time of posting is of little importance but timing of the market is extremely important.  We are only concerned with profit.

In my last post (check for yourself, below) I forecasted a high in the Dow Jones Industrial Average of 20,193.  On Friday, 02/10/17 the index closed at 20,269 and so I decided it's finally time for an update to my blog.

The American stock market has been on a rip roaring tear, virtually straight up since April of 2009 !

As of this writing, I see no reason to get out of this stock market.  Unfortunately, I no longer have any price targets to disclose.  In order for me to predict price, I need some relatively strong volatility and we have none to speak of.

The only thing I can do is to wait and watch for the market to give me a sell signal.

As soon as I see it, I'll let you know.  I do not believe that I will be seeing that anytime soon.

Going forward, I will continue to Dollar Cost Average all of my long term investment money into a No Load, Stock Market Mutual Fund that mirrors the total American stock market (Wilshire 5000).

Thanks for reading, see you next time.

Let’s Do It Again !!

As I write this we have just closed the month of November 2016.  The DOW closed at 19,123.

This is good stuff, I said it in November 2013 and said it again in July of 2016, I see no reason to not be all in the total American stock market.

I have not been issued a sell signal, just conformation of additional upside action.

Now that we reached my prior forecast of 18,974, it’s time for a new forecast.

Here you go:  I am now expecting the Dow Jones Industrial Average to trade at 20,193.


There you have it.


Once we get there, I will provide additional  insight.  If something crazy happens, I will also let you know what I think the market will do and what I plan to do about it.

For now I will continue to invest any long term money that I have, using dollar cost averaging, in a no-load, mutual fund that mirrors the complete U.S. stock market (Wilshire 5000).

Thanks for visiting, don’t be a stranger.

Not Over Yet!

This post will be short and without drama.  Back in November of 2013 I advised you, right here (look for yourself) that I did not see any reason for not being all in the total U.S. stock market.

My projection back then was for a high in the Dow Jones Industrial Average of  18,974.

We flirted a little while with a possible sell signal coming in prior to that but that sell signal never materialized.  I later mentioned that we would be careful until we had a monthly close in the Dow of  greater than 18,400.  So on the last day of trading in July 2016 we closed on a monthly basis at 18,432.

My forecast of 18,974 has been changed to a minimum, meaning I now expect the Dow to trade at 18,974 at a minimum.  Once it clears that price, I will offer an additional forecast.  If something happens in the mean time, I will also post.

For now I will continue to invest any long term money that I have, using dollar cost averaging, in a no-load, mutual fund that mirrors the complete U.S. stock market index (Wilshire 5000).

2015 Recap and 2016 Forecast

The U.S. Stock Market Closes the Year Under Some Pressure

Well, from what I can tell there’s bad news and some other kind of news.  I’ll just give it to you straight.

First off, if you were 100% invested in the total U.S. stock market all of 2015 as I was, you saw record highs and then steep drawdowns.  Here’s the bad news, according to my calculations we finished basically even for the year.  I calculate a gain of approximately 0.4%, all that work for NOT a whole lot of gain.

If you had all of your long term money in a money market account (like a federal money market fund) you earned somewhere around 0.05%.  If you had all of your long term money in a bond market account (like an intermediate government bond fund) you earned somewhere around 1.6%.  All in all, not a good year for the long term investor.  Here’s some other kind of news, my studies indicate we may be in for another pull back.  I use a specific type of study/indicator that is constructed in parts.  We build it in parts so that we don’t panic over noise and we don’t stick around once we get conformation.  As of this writing the market has completed 2 of the 3 parts needed to indicate that another drawdown is at hand.

So, I told you back in October that we needed to clear 18,400 in the Dow before we could start to have additional faith in the continuation of this bull market.  As we have not been able to do that and we now have seen the longest leg of growth (40+ months) in this market since the bull started and we see a real possibility of a sell signal, we have cause to be diligent.

Let me tell you what I am going to do, I am going to continue to leave all of my long term investment capital invested in a total U.S. stock market mutual fund.  I will continue to invest any additional money I may have into a total U.S. stock market mutual fund.  If we get a single close, on a monthly basis, below 15,300 in the Dow. I will be taking additional measures. 

I will let you know what additional measures I will be taking if and when it becomes necessary.

Stay tuned.

In Wake of the Drawdown

Ok so here we are with a pretty sizable retracement.  We went from a high in the Dow of 18,351 down to a low of 15,377 before this thing stopped and turned.  We came within 623 points of our projected high, a high that we called for back in 2013.  There is no reason to change that projection.  This economy has been doing an excellent job and folk that have not been invested in the stock market have totally missed out on an excellent return.  Remember, we've been long since March of 2009 and if you look at a long term chart you will see that we've been nothing but up with the occasional pull back.

What I'm seeing right now is this market needed to rest and get some strength together before going higher.  But hold your horses, we still may have some drama in front of us.

We need to close above 18,400 in the Dow before we can say we are out of the woods and we may or may not get there in 2015.  But, if we get that close, we may just be on our way to blow past my 2013 prediction.  Again, don't count you chickens before they hatch.

I'll keep you posted on what I'm doing.  Right now, I am still long the American stock market with 100% of my assets invested in a no-load, total stock market index mutual fund, like the Wilshire 5000.  I am also dollar cost averaging any new money into the Wilshire 5000.

Shoot me an email or post your thoughts if you are so inclined.