When there is a new IFT, how do I make the change?

First go to TSP.gov and log into your account. Click on "Change Investments" on the top tab. Go to "Move money between funds" and click on "Get Started." 1. Choose Funds to Move Money From - fill in 100% for each fund(s) you currently have, and continue. 2. Choose Funds to Move Money To - fill in the allotments that are recommended (make sure they total to 100%), and continue. 3. Review - and Submit.

When you release a new trading signal does this apply to personal contributions as well as the Interfund Transfer (IFT)?

When our system issues a new trade, this only applies to an IFT, which is your TSP balance, not your contributions. So when I say I am making an allocation change, I am referring to my balance and HAVE to use an IFT to do so. One doesn't need to use an IFT to make a contribution change and what you have your new money (contributions) buying is really up to you. We are traders, so that new money will be transferred to your new balance allocation at your next IFT anyway.

When the market is going strong, should I allocate 100% in one specific fund when making an interfund transfer on the tsp.gov site?

Overall, we personally believe in diversification. An investor should always attempt to minimize risk, meaning never put all of your eggs in the same basket. We can not advise anyone how much capital they should trade. Everyone has their own financial objectives and risk tolerances. Everyone is responsible for their own final financial decisions. However, we will state our opinion as to what we are doing in our own account, our reasoning behind our decision, and the percentage breakdown between the various funds.

Ok, since you strongly believe in diversification, what is a good method you would use in your decision process to assign the percentages between the funds?

On our members page, we assess the current market condition using fundamental and technical chart analysis. We also present our opinion by writing technical commentary for each of the funds.

Here's a specific example: The S&P is currently undergoing a little profit taking, but we do not expect the decline to be that significant. The negative divergence we mentioned in last week's newsletter is now taking effect as the stock declines. However, since the divergence was not an extreme amount, it is almost worked off since then. We are still sticking to our recognition of the all important Fibonacci 0.618 retracement level. We iterate what we stated two weeks ago: "We believe the S&P will tag a Fibonacci 0.618 retracement of the 2000 high to the 2002 low. That equates to a move to 1253.45 for the S&P 500 index (about $125.3 for SPY). We calculated this number by using the March 24, 2000 S&P high of 1553.11 and the October 10, 2002 S&P low of 768.67. The difference between these values is 784.44 points. Multiplying this value by 0.618 gives 484.78, and then adding this to the 2002 low of 768.67 equates to 1253.45." This value also plots out to be very close to where trendline resistance is shown on the chart (see blue trendline). Therefore, if the fund continues to approach this level, we will definitely be interested in switching to less risky funds, probably the F Fund (ticker: AGG) and G Fund. Our conclusion of last week is still valid: ... "For now, we foresee a short-term pullback to work off the small amount of bearish divergence, and then the index should increase toward the 0.618 Fib level."

What is the general length of time in a certain fund(s) before switching to another fund(s)?

There is no general answer that fits all conditions. The market is an ever changing beast. If the stock market is trending up, we may suggest for members to have the majority of their savings in the stock funds. If the market is going lateral or trending down, we may suggest for members to have most of their savings in the G or F Funds. How long they must stay in these funds is only known by Mr. Market. Meaning, we have to see a change in character of the market and/or notice something through fundamental or technical analysis that warrants caution or the likelihood of profitability. Hopefully we recognize the potential of change before it happens. All we can say, is that we assess the current market condition on a day-to-day basis and present our opinion to the best of our ability. In addition, all trades will adhere to the New Interfund Transfer Rule.

Can you explain in detail the New Interfund Transfer Rule?

As per the New Interfund Transfer Rule your first two IFTs can redistribute money in your account among any or all of the TSP funds. After that, for the remainder of the month, your IFTs can only move money into the Government Securities Investment (G) Fund (in which case, you will increase the percentage of your account held in the G Fund by reducing the percentage held in one or more of the other TSP funds.

What is the difference between long, intermediate, and short-term trends?

Market trends are generally divided into three categories: major (long-term), intermediate, and short-term. A major trend usually lasts for more than a year. Since the stock market peaked in October 2007, the current downturn is "major" in scope. There were three major (long-term trends) in the eight years since 2000. The stock market experienced a two-year downtrend from 2000 to 2002, a five-year uptrend from 2003 to 2007, and a one-year downtrend since then. Monthly MACD lines provided three major signals in the last eight years -- a major sell in 2000, a major buy in 2003, and major sell at the end of 2007. The major trend is by far the most important because it overrides signals on weekly and daily charts.

Intermediate trends represent corrections to major trends and generally last from one to six months. The market experienced an "intermediate" bounce from March to May '08. The bounce lasted 10 weeks before turning back down again. In addition, the intermediate bounce retraced a half of the previous downtrend from October '07 to March '08. That's pretty typical. The least important trend is the "short-term" variety.

Short-term trends, which are generally shown on daily charts, usually last less than a month. In many cases, they may last for only a week or two. There were a number of short-term bounces over the last six months. The rally during July and August '08 lasted a month as did the "triangle" formation during October '08. The triangle formation was composed of two short bounces that lasted about a week each. One of the ways to determine if a short-term bounce is turning into an intermediate rebound is the market's ability to climb over its 50-day moving average.

I've heard through the grapevine that you offer a service for trading Exchange Traded Funds (ETFs). Can you tell me more about this service?

Our ETF Premier System is designed to build capital with funds not related to your TSP retirement savings. To be a part of this service, all you will need is an online broker account, like Schwab.com.

This is how the system works. When we have selected an ETF to trade, we will send out an ETF Alert via email and/or text message. This is not to be confused with our TSP Allocation Service (or TSP Alert), which involves the 5 TSP Funds for your retirement savings. The ETF Premier System is a service that is totally separate from the TSP Allocation Service.