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Strategies & Market Trends : Peabody Coal vanguard retirement forum

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From: MACD X2/24/2008 2:08:52 PM
   of 75
 
02 22 08, no change remain in the bond fund.

This week as the last and the last before that the group of stocks that we follow are in a bearish mode [down trend] and nothing has changed.

I felt like we may have go a opportunity in the last few weeks to get an entry but it didnt happen and we stay in the comfort of the bond fund.

Why is this? And what would it take for me to change recommendation to enter into one of the stock funds?

Well what I am watching is on all the chart that are offered to us at peabody, these charts are on the link below.

stockcharts.com

Each and every chart has a 13 week moving average line that is blue and a 34 week moving average that is red. This has been talked about on most every post that I have done lately and is the bases of our trading system. We want to be invested in stocks that are moving up, or in up trending modes.

All the stocks above except the bond fund are in down trending modes. I have paint all that are in down trending modes in black and all that are in uptrending modes in green.

notice that When these charts were moving up price rode the blue line from above and every once in a while drop below to test the red line but always staying above for the most part.

This is what up trending stocks do and is a trade mark of an uptrending stock.

When I started this site back last fall the recommendation was to be in large caps vanguard prime cap fund. And it did well what time that we were into this fund, but in early Nov. after a long run up the recommendation was changed to the bond fund which we are now invested 100%.

The market was down nearly 20% while bonds have traded basically flat or slightly up.

One fellow told me that vanguard wrote him and told him that he was 100% in bonds and they suggested he realocate his funds to diversify.

This is funny to me being the market has been down so much that they recommend him to want some stock exposure.

Personnelly I dont want any at this time. So what would it take to want some stock exposure?

First thing is I want some of these funds to have price cross over the blue line that they are riding under on the charts above, this will be the first signal.

Secondly, I would like to see a test of a bottom to comfirm that a bottom is in place.

I the last few post I wrote to get ready to make a switch, I was waiting on the test of the recent bottom, this didnt occurr and neither did the signal to change recommendations.

I feel like the market may trade down to sideways for several years. If this occurrs it will be hard to make money in stock funds as your investment will basically trade sideways to down.

Of course what I feel will make little difference as we will watch the signals and hope for a substancial uptrend to unfold. So far we are in a down trend and until proven other wise stick with the safety of the bond fund.

To help you understand what I am watching and trying to follow watch the movie below. It is an out of date movie as it was written about a year ago but the message is the same as when to enter and when to exit positions when trying to follow long term trends such as this site is trying to do.

screencast.com

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