OTM Market Update – More of the Same

Prior Week Market Performance:

  • The S&P large caps gained 2.6% last week to 2108.06.
  • The Russell 2000 small caps gained 2.8% last week to 1266.37.
  • Long Bonds (TLT) gained 3.8% last week to 131.51.
  • Asset Allocation Model: unchanged.  Stocks (52.5%); Bonds (27.5%); Discretionary (20%)

 Last Commentary (two weeks ago):  The Asset Allocation model remains unchanged for long term investors.  IF we were to get further deterioration then it would be time to take a different tack.  We get closer to a shift from long bonds, but not yet.  Not yet.  Be patient.

Current Technical Model Indicators (Short, Med, Long periods):

  • Large Cap S&P 500 – BUY, BUY, BUY
  • Mid  Caps – BUY, BUY, BUY
  • Small Caps – BUY, BUY, BUY
  • Micro Caps – BUY, BUY, BUY
  • Long Bonds – BUY, BUY, BUY

 This Week’s Commentary:  Technicals for all of the various asset classes except for Gold remain bullish and have not deteriorated over the past two weeks.  The Russell small caps have clearly risen above a 1220 resistance point, and that is a positive leading sign for the overall market.  Asset allocation continues bullish in favor of equities 52% to 28% for bonds.

This cannot go on forever, but for right now everyone is an investing expert.  As long as the Fed sets the table the market will eat.  For now.

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