10/19/11
For the 9th consecutive day, the Dow alternated between being up and down by closing up 180-points after Monday's 248-point loss. Despite the strange streak, the Dow made its second highest close in over 3-months after being down 100 points earlier in the day.
For the TSP, the C-fund was up 2.04% yesterday, the S-fund gained 2.62%, the I-fund added 1.18%, and the F-fund (bonds) was up 0.01%.
The S&P 500 hit the 200-day EMA for the first time since early August but closed slightly below it making what looks to be a flat top (potentially bearish) and again resting against the August high. Volume picked up, and that usually happens when you get a good turnaround like we did on Turnaround Tuesday.
Chart provided courtesy of www.decisionpoint.com, analysis by TSP Talk
You have to love technical analysis when you see the 200-day EMA act as resistance, on the same day when the 50-day EMA acted as support. The 20-day EMA is close to moving above the 50-day EMA, and as we talked about, in bear market that can be a sign of being overbought.
For the Dow, it was the 20-day EMA that acted as support and the 200-day acting as resistance. You can see that the 200-day EMA has held in all 4 of the recent tests.
Chart provided courtesy of www.decisionpoint.com, analysis by TSP Talk
The NYSE is still above the +500 overbought level. During a bull market we could see this hit +1000 but if we are going to remain in a bear market, this area can be some trouble for the index.
Chart provided courtesy of www.decisionpoint.com, analysis by TSP Talk
The put / call ratios show the smart money playing a little defense expecting a pullback while the dumb money is starting to hit the fall trading range bullish highs. This is a short-term red flag.
Chart provided courtesy of www.decisionpoint.com, analysis by TSP Talk
The dollar has pulled back sharply from the early October highs, coinciding with the market rally off of the lows. It seems to be trying to find support at the 50-day and 200-day EMA's, and if they hold, a rally in the dollar could pose a little trouble for stock prices.
Chart provided courtesy of www.decisionpoint.com, analysis by TSP Talk
Earnings are pouring in with mixed results. Intel and Yahoo came in better than expected after the close yesterday, while Apple missed estimates for the first time since 2004. Intel is in the Nasdaq but is also part of the Dow, while Apple is a very big part of the Nasdaq Index so there could be some pressure on that index today.
Europe is still the main headline and there is a big meeting this coming Sunday. The continuous rumors seem to be pushing and pulling our indices while we wait, but Monday could be a big day - one way or the other.
Will the Dow break its 9-day up / down / up /down... pattern today by being up a for 2nd consecutive day, or will the streak move to 10 days?
Thanks for reading! We'll see you back here tomorrow.
For the 9th consecutive day, the Dow alternated between being up and down by closing up 180-points after Monday's 248-point loss. Despite the strange streak, the Dow made its second highest close in over 3-months after being down 100 points earlier in the day.
For the TSP, the C-fund was up 2.04% yesterday, the S-fund gained 2.62%, the I-fund added 1.18%, and the F-fund (bonds) was up 0.01%.
The S&P 500 hit the 200-day EMA for the first time since early August but closed slightly below it making what looks to be a flat top (potentially bearish) and again resting against the August high. Volume picked up, and that usually happens when you get a good turnaround like we did on Turnaround Tuesday.
Chart provided courtesy of www.decisionpoint.com, analysis by TSP Talk
You have to love technical analysis when you see the 200-day EMA act as resistance, on the same day when the 50-day EMA acted as support. The 20-day EMA is close to moving above the 50-day EMA, and as we talked about, in bear market that can be a sign of being overbought.
For the Dow, it was the 20-day EMA that acted as support and the 200-day acting as resistance. You can see that the 200-day EMA has held in all 4 of the recent tests.
Chart provided courtesy of www.decisionpoint.com, analysis by TSP Talk
The NYSE is still above the +500 overbought level. During a bull market we could see this hit +1000 but if we are going to remain in a bear market, this area can be some trouble for the index.
Chart provided courtesy of www.decisionpoint.com, analysis by TSP Talk
The put / call ratios show the smart money playing a little defense expecting a pullback while the dumb money is starting to hit the fall trading range bullish highs. This is a short-term red flag.
Chart provided courtesy of www.decisionpoint.com, analysis by TSP Talk
The dollar has pulled back sharply from the early October highs, coinciding with the market rally off of the lows. It seems to be trying to find support at the 50-day and 200-day EMA's, and if they hold, a rally in the dollar could pose a little trouble for stock prices.
Chart provided courtesy of www.decisionpoint.com, analysis by TSP Talk
Earnings are pouring in with mixed results. Intel and Yahoo came in better than expected after the close yesterday, while Apple missed estimates for the first time since 2004. Intel is in the Nasdaq but is also part of the Dow, while Apple is a very big part of the Nasdaq Index so there could be some pressure on that index today.
Europe is still the main headline and there is a big meeting this coming Sunday. The continuous rumors seem to be pushing and pulling our indices while we wait, but Monday could be a big day - one way or the other.
Will the Dow break its 9-day up / down / up /down... pattern today by being up a for 2nd consecutive day, or will the streak move to 10 days?
Thanks for reading! We'll see you back here tomorrow.
Tom Crowley
The legal stuff: This information is for educational purposes only! This is not advice or a recommendation. We do not give investment advice. Do not act on this data. Do not buy, sell or trade the funds mentioned herein based on this information. We may trade these funds differently than discussed above. We use additional methods and strategies to determine fund positions.
The legal stuff: This information is for educational purposes only! This is not advice or a recommendation. We do not give investment advice. Do not act on this data. Do not buy, sell or trade the funds mentioned herein based on this information. We may trade these funds differently than discussed above. We use additional methods and strategies to determine fund positions.
What typically happens after this kind of up/down action (how does the ride usually end)?
