It’s been a tough week for the markets. All 3 stock funds are getting clobbered and the F fund has made some big gains relatively. As investors are fleeing the stock market for safe havens like U.S. Treasury Bonds, the yield on those bonds goes down and the price goes up.
Currently the stock funds are looking pretty over sold while the F fund is looking pretty over bought.
I’m looking for a recovery rally in stocks within the next several days. There is some significant support at the 5 year weekly 200 Week Moving Average (see chart below). The peak of this rally will be the time to get out of stocks and into the G and/or F funds.
The F fund is currently very over bought and sustained a big reversal today (see chart below). As stocks recover, the F fund will pull back to it’s 200DMA and 50DMA. As the F fund finds support at the 108-109 level it will be time to look at reallocating from stock funds to F/G funds.
Stay tuned. Things are getting very interesting…