Stocks rallied sharply on Thursday putting an end the one-day pullback. The Dow gained 96-points on the day, while the S&P saw more modest gains, buy the Nasdaq and small caps kept up with the Dow.
[TABLE="align: center"]
[TR]
[TD]
[TD="align: center"] Daily TSP Funds Return[TABLE="width: 170"]
[TR]
[TD="align: right"] G-Fund:[/TD]
[TD] +0.0056%[/TD]
[/TR]
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[TD="align: right"] F-fund:[/TD]
[TD] -0.14%[/TD]
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[TD="align: right"] C-fund:[/TD]
[TD] +0.33%[/TD]
[/TR]
[TR]
[TD="align: right"] S-fund:[/TD]
[TD] +0.61%[/TD]
[/TR]
[TR]
[TD="align: right"] I-fund:[/TD]
[TD] +0.49%[/TD]
[/TR]
[/TABLE]
[TABLE="align: center"]
[TR]
[TD="align: right"] [/TD]
[/TR]
[/TABLE]
[/TD]
[/TR]
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The S&P 500 (SPY) bounced back from the small decline on Wednesday, but it did finally break below that sharp rising narrow trading channel. The rally has been relentless but it is getting extended and some kind of a pullback is due - although we have said that in vain many times this year.
Chart provided courtesy of www.decisionpoint.com, analysis by TSP Talk
The the longer-term chart shows a break above the top of a rising trading channel, which looks like a wedge. They don't tend to break to the upside but so far it has remained above this resistance line. Is this a fake-out like we saw earlier this month (circles)?
Chart provided courtesy of www.decisionpoint.com, analysis by TSP Talk
The Transportation Index continued its relentless ascent having been up for 7 days in a row and 11 of the last 12 days. How long can this last? I'd say not too much longer, but how steep any pullback will be, I don't know. The 20-day EMA would be my first guess at a target.
Chart provided courtesy of www.decisionpoint.com, analysis by TSP Talk
The dollar continues its slide since the debt deal was made, and obviously for a longer than that. As long as the dollar is in decline, the I-fund should be a consideration if you are in the stock funds.
Chart provided courtesy of www.decisionpoint.com, analysis by TSP Talk
Bond yields rebounded yesterday (Thursday) after plummeting for several days. I don't know how much they can rise with QE back on course with little end in sight for the near future, but in the short-term there are some big open gaps that could be upside targets.
Chart provided courtesy of www.decisionpoint.com, analysis by TSP Talk
The rally in yields meant a weak day for the F-fund as bond prices rolled over. This is still a bullish chart for bonds, but perhaps a short-term pullback is due.
Chart provided courtesy of www.decisionpoint.com, analysis by TSP Talk
I'm still out of my office so I apologize for any delays in responding to emails or messages in the forum. I'll be back on Monday in normal routine.
In today's TSP Talk Plus report we go over the Sentiment Survey results, and an interesting chart showing what aggressive investors are doing now.
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Thanks for reading! Have a great weekend!
Tom Crowley
Posted daily at TSP Talk Market Commentary
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