March 10, 2020

The market has closed 3.5% below the HCM-BuyLine®, forcing us to reduce exposure to equities.

Our two ETFs will be moved to 50% invested and 50% short term treasury.

Our mutual funds will be re-balanced to approximately 35-55% cash or short-term bonds, depending on the fund and strategy.

The 401(k) Optimizer® and the TSP Optimizer® will be sending out new allocations.

If further erosion occurs, we will be reducing exposure to equities even more.

The market looked like it was trying to put in a bottom on Friday, dropping down and retesting the lows set a few days before, and then rally off the lows. However, with this morning’s sell-off it has crossed the HCM-BuyLine® signaling there is a change in trend. 

20 year

There is a tremendous amount of fear surrounding the coronavirus, and what appears to be an oil price war, which was totally unexpected and causing shockwaves this morning. You can expect some extremely volatile days for the near term, with rallies that make you wonder why you have reduced risk and selloffs that will take your breath away. We do see this persisting for a number of months before it stabilizes, and a new uptrend is established.

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