Stocks opened higher on Monday, hitting the intraday highs almost as soon as the trading began, but spent the rest of the day chopping in a tight, slightly lower range. It was a bit of a snoozer with the Dow losing 14-points on the day, and while the losses weren't bad, the negative reversals don't help.
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On the bright side, the Dow held onto most of Friday's 190-point gains so the bears did not have much bite. It seemed more like a battle between some profit takers and dip buyers with the profit taking winning by a nose.
The S&P 500 (C-Fund) was down slightly but held onto most of Friday's gains, holding above the breakout point, which is the top of the flag formation, and the new short-term rising support line.
The DWCPF (S-fund) remained within its rising flag pattern, finding some support at the bottom of the flag, but that looks like a small negative reversal pattern. It's certainly not a topping formation, but it is a short-term test of the rising trend.
The Dow Transportation Index was up sharply early on Monday after Friday's big 2% rally. It closed with a slight gain but created a big negative reversal candlestick after hitting some overhead resistance at the highs. It looks like some short-term weakness is possible, and more profit taking is possible, but the chart still looks better now than it did a week ago.
Oil rallied again creating what looks like a possible "V" bottom, but there is still a lot of resistance having fallen below all of the major moving averages that we track.
The Japanese Nikkei broke out of a big bull flag and above some longer-term descending resistance yesterday. It's above the 50-day EMA but still below the 200-EMA. The I-fund probably needs this one before it can compete with the U.S. market funds.
The AGG (Bonds / F-fund) was up slightly as it continues to trade within that red flag formation. Those blue boxes are gaps that are still open and quite large at that.
Read more in today's TSP Talk Plus Report. We post more charts, indicators and analysis, plus discuss the allocations of the TSP and ETF Systems. For more information on how to gain access and a list of the benefits of being a subscriber, please go to: www.tsptalk.com/plus.php
Thanks for reading. We'll see you back here tomorrow.
Tom Crowley
Posted daily at www.tsptalk.com/comments.php
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