07/22/25
Stocks opened higher on Monday and the bulls held the morning high until the last couple of hours of the day where the indices looked weary, rolled over, and closed near the lows of the day. The Dow erased a 250+ point gain to close the day with a slight loss. The S&P 500 (C-fund) held onto a small gain while small caps fell sharply. Bond yields and the dollar were down helping the F and I-funds to gains on the day.
(The most current commentary is always posted here: www.tsptalk.com/comments.php)
This isn't the best looking intraday chart for stocks. It's a negative reversal day and quite the opposite of what we had been seeing recently.
The S&P 500 (C-fund) made a new high in early trading, and it did actually closed at a new high with that 0.14% gain on the day. But that negative reversal could turn into trouble if this chart doesn't bounce right back today. The problem on this three month chart is that rising support is getting tested right here, so any more downside could break that key red support line.
I am still looking at last week's negative outside reversal day (N.O.R.) on the IWM (Russell 2000) as a potential warning sign, technically a more bearish formation that just yesterday's reversal day. As I mentioned previously, those days tend to precede some kind of bearish downturn within a few days to a week or so. I gave examples of prior occurrences last week, and unless something changes quickly for the small caps, we could be seeing that bearish downturn starting to percolate. The S-fund is not the Russell 2000, but it also had this NOR formation, as you'll see down below in the TSP fund charts section down below.
I talked about this in the forum yesterday, and I have mentioned it once or twice over the years. 1998 was a game changer for me. I've been messing with the stock market for many years but in 1998, back when we were only able to make one IFT (transaction) per month and it had to be completed by the 15th of the month to take affect on the 1st of the following month - if you can believe that. And we only had the C-fund for stocks exposure.
Anyway, the stock market had been roaring for years: The S&P 500 was up 37% in 1995, 23% in '96, another 33% in '97, and 1998 started out with more big gains. Take a look at that rally in the chart below from January to early April.
I was dabbling with trying to time the market, probably the worse type of market to do that, but I had did some selling during the rally and by July 15th, the deadline to make a trade for August 1st, I capitulated and went all in.
Right after I made the change, stocks finally started to tumble. Too late to take my transaction back, and fast forward a few weeks and the C-fund ended August with a loss of 14%. Not good.
Of course I bring this up, not only because the stock market may have come too far too fast in the three and a half months since the April lows, but also because of the tendency to see some kind of correction in late July and / or in August. There are probably a couple of morals here, but one is, you probably don't want to chase a market that has already been hot for a while. Another is to maybe take a little off the table when you've bagged a ton of gains in recent months. You should get a chance to buy lower when volatility picks up.
Here's a long-term monthly chart of the S&P 500 going back to before the financial crisis.
You never know when momentum is going to change, but it always seems to take longer than we think. That's why I am still holding some stocks funds, and may continue to until the charts start to break, but so far there have only been a few cracks and warnings.
The DWCPF / S-fund has also been up and down since that negative outside reversal day, but there could be more volatility to follow - at least there tends to be. The big test will be the support from the top of the old channel near 2340. There is an open gap down below 2250.
ACWX (I-fund) hit some old broken support yesterday and reversed lower, but not before adding a nice gain on the day as the weakness in the dollar helped it lead the other TSP funds.
The dollar looks to be rolling over at the top of that blue descending trading channel, and the 50-day average. It may be that the I-fund is ready to take the lead again after the early July rally in the dollar held it back for a few weeks.
BND (bonds / F-fund) had a profitable day as yields slipped lower and the chart gapped back up above the top of the red trading channel.
Thanks so much for reading! We'll see you back here tomorrow.
Tom Crowley
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
Questions, comments, or issues with today's commentary? We can discuss it in the Forum.
Daily Market Commentary Archives
For more info our other premium services, please go here... www.tsptalk.com/premiums.php
To get weekly or daily notifications when we post new commentary, sign up HERE.
Posted daily at www.tsptalk.com/comments.php
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 may use additional methods and strategies to determine fund positions.
Stocks opened higher on Monday and the bulls held the morning high until the last couple of hours of the day where the indices looked weary, rolled over, and closed near the lows of the day. The Dow erased a 250+ point gain to close the day with a slight loss. The S&P 500 (C-fund) held onto a small gain while small caps fell sharply. Bond yields and the dollar were down helping the F and I-funds to gains on the day.
(The most current commentary is always posted here: www.tsptalk.com/comments.php)
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This isn't the best looking intraday chart for stocks. It's a negative reversal day and quite the opposite of what we had been seeing recently.
The S&P 500 (C-fund) made a new high in early trading, and it did actually closed at a new high with that 0.14% gain on the day. But that negative reversal could turn into trouble if this chart doesn't bounce right back today. The problem on this three month chart is that rising support is getting tested right here, so any more downside could break that key red support line.
I am still looking at last week's negative outside reversal day (N.O.R.) on the IWM (Russell 2000) as a potential warning sign, technically a more bearish formation that just yesterday's reversal day. As I mentioned previously, those days tend to precede some kind of bearish downturn within a few days to a week or so. I gave examples of prior occurrences last week, and unless something changes quickly for the small caps, we could be seeing that bearish downturn starting to percolate. The S-fund is not the Russell 2000, but it also had this NOR formation, as you'll see down below in the TSP fund charts section down below.
I talked about this in the forum yesterday, and I have mentioned it once or twice over the years. 1998 was a game changer for me. I've been messing with the stock market for many years but in 1998, back when we were only able to make one IFT (transaction) per month and it had to be completed by the 15th of the month to take affect on the 1st of the following month - if you can believe that. And we only had the C-fund for stocks exposure.
Anyway, the stock market had been roaring for years: The S&P 500 was up 37% in 1995, 23% in '96, another 33% in '97, and 1998 started out with more big gains. Take a look at that rally in the chart below from January to early April.
I was dabbling with trying to time the market, probably the worse type of market to do that, but I had did some selling during the rally and by July 15th, the deadline to make a trade for August 1st, I capitulated and went all in.
Right after I made the change, stocks finally started to tumble. Too late to take my transaction back, and fast forward a few weeks and the C-fund ended August with a loss of 14%. Not good.
Of course I bring this up, not only because the stock market may have come too far too fast in the three and a half months since the April lows, but also because of the tendency to see some kind of correction in late July and / or in August. There are probably a couple of morals here, but one is, you probably don't want to chase a market that has already been hot for a while. Another is to maybe take a little off the table when you've bagged a ton of gains in recent months. You should get a chance to buy lower when volatility picks up.
Here's a long-term monthly chart of the S&P 500 going back to before the financial crisis.
You never know when momentum is going to change, but it always seems to take longer than we think. That's why I am still holding some stocks funds, and may continue to until the charts start to break, but so far there have only been a few cracks and warnings.
The DWCPF / S-fund has also been up and down since that negative outside reversal day, but there could be more volatility to follow - at least there tends to be. The big test will be the support from the top of the old channel near 2340. There is an open gap down below 2250.
ACWX (I-fund) hit some old broken support yesterday and reversed lower, but not before adding a nice gain on the day as the weakness in the dollar helped it lead the other TSP funds.
The dollar looks to be rolling over at the top of that blue descending trading channel, and the 50-day average. It may be that the I-fund is ready to take the lead again after the early July rally in the dollar held it back for a few weeks.
BND (bonds / F-fund) had a profitable day as yields slipped lower and the chart gapped back up above the top of the red trading channel.
Thanks so much for reading! We'll see you back here tomorrow.
Tom Crowley
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
Questions, comments, or issues with today's commentary? We can discuss it in the Forum.
Daily Market Commentary Archives
For more info our other premium services, please go here... www.tsptalk.com/premiums.php
To get weekly or daily notifications when we post new commentary, sign up HERE.
Posted daily at www.tsptalk.com/comments.php
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 may use additional methods and strategies to determine fund positions.
