05/02/13
Stocks opened lower yesterday and the market continued its slide most of the day. There was a brief post Fed policy announcement rally, but the decline resumed and the indices closed near their lows. The Dow lost 139-points
[TABLE="align: center"]
[TR]
[TD]
[/TD]
[TD="align: center"] Daily TSP Funds Return[TABLE="width: 152"]
[TR]
[TD="align: right"] G-Fund:[/TD]
[TD] +0.0043%[/TD]
[/TR]
[TR]
[TD="align: right"] F-fund:[/TD]
[TD] +0.13%[/TD]
[/TR]
[TR]
[TD="align: right"] C-fund:[/TD]
[TD] -0.93%[/TD]
[/TR]
[TR]
[TD="align: right"] S-fund:[/TD]
[TD] -1.79%[/TD]
[/TR]
[TR]
[TD="align: right"] I-fund:[/TD]
[TD] -0.19%[/TD]
[/TR]
[/TABLE]
[TABLE="align: center"]
[TR]
[TD="align: right"] [/TD]
[/TR]
[/TABLE]
[/TD]
[/TR]
[/TABLE]
Despite the fact that the S&P 500 is just off its recent all-time highs, there's no doubt that the character of the market has changed as we are seeing more volatility with sharp rallies and steep declines over the last several weeks. The buy and holders have made money, but recently the market timers have been able to do some buy low, sell high trading.
You can see how the steep short-term rising trends, once broken, can lead to at least some short-term trouble, but so far the moving averages have offered support.
Chart provided courtesy of www.decisionpoint.com, analysis by TSP Talk
I have posted the two prior market tops of this recent intermediate-term rising trading channel before, and since then we've seen a possible similar top developing - that is only if we don't see another push higher above recent highs.
Chart provided courtesy of www.decisionpoint.com, analysis by TSP Talk
You can see that the smaller trading channels, once broken, led to to more serious corrections so the concern for the current rally will be that support near the 1550 - 1560 area.
The Transports moved back into the wedge formation making the fake-out / break-down we talked about, a real possibility here.
Chart provided courtesy of www.decisionpoint.com, analysis by TSP Talk
Small caps were hit hard yesterday as the S-fund dropped 1.8% yesterday, while the Russell 2000 lost 2.4% on very heavy volume. The 50-day EMA is being tested again and if support holds here, we could be looking at a possible right shoulder of a bullish inverted head and shoulders pattern, but caution is warranted since the 50-day EMA had already broken twice in April.
Chart provided courtesy of www.decisionpoint.com, analysis by TSP Talk
As we mentioned yesterday, if stocks fell from their recent highs, bonds had a better chance of breaking above their recent resistance, and that is what happened. Now there are two levels of support for the bond ETF - the rising support line, and the old resistance line.
Chart provided courtesy of www.decisionpoint.com, analysis by TSP Talk
The April jobs report will be released tomorrow morning. Consensus estimates are in the area of adding 155,000 jobs, and an unemployment rate of 7.6%.
Thanks for reading! We'll see you back here tomorrow.
Tom Crowley
Posted daily at TSP Talk Market Commentary
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.
Stocks opened lower yesterday and the market continued its slide most of the day. There was a brief post Fed policy announcement rally, but the decline resumed and the indices closed near their lows. The Dow lost 139-points
[TABLE="align: center"]
[TR]
[TD]
[TD="align: center"] Daily TSP Funds Return[TABLE="width: 152"]
[TR]
[TD="align: right"] G-Fund:[/TD]
[TD] +0.0043%[/TD]
[/TR]
[TR]
[TD="align: right"] F-fund:[/TD]
[TD] +0.13%[/TD]
[/TR]
[TR]
[TD="align: right"] C-fund:[/TD]
[TD] -0.93%[/TD]
[/TR]
[TR]
[TD="align: right"] S-fund:[/TD]
[TD] -1.79%[/TD]
[/TR]
[TR]
[TD="align: right"] I-fund:[/TD]
[TD] -0.19%[/TD]
[/TR]
[/TABLE]
[TABLE="align: center"]
[TR]
[TD="align: right"] [/TD]
[/TR]
[/TABLE]
[/TD]
[/TR]
[/TABLE]
Despite the fact that the S&P 500 is just off its recent all-time highs, there's no doubt that the character of the market has changed as we are seeing more volatility with sharp rallies and steep declines over the last several weeks. The buy and holders have made money, but recently the market timers have been able to do some buy low, sell high trading.
You can see how the steep short-term rising trends, once broken, can lead to at least some short-term trouble, but so far the moving averages have offered support.
Chart provided courtesy of www.decisionpoint.com, analysis by TSP Talk
I have posted the two prior market tops of this recent intermediate-term rising trading channel before, and since then we've seen a possible similar top developing - that is only if we don't see another push higher above recent highs.
Chart provided courtesy of www.decisionpoint.com, analysis by TSP Talk
You can see that the smaller trading channels, once broken, led to to more serious corrections so the concern for the current rally will be that support near the 1550 - 1560 area.
The Transports moved back into the wedge formation making the fake-out / break-down we talked about, a real possibility here.
Chart provided courtesy of www.decisionpoint.com, analysis by TSP Talk
Small caps were hit hard yesterday as the S-fund dropped 1.8% yesterday, while the Russell 2000 lost 2.4% on very heavy volume. The 50-day EMA is being tested again and if support holds here, we could be looking at a possible right shoulder of a bullish inverted head and shoulders pattern, but caution is warranted since the 50-day EMA had already broken twice in April.
Chart provided courtesy of www.decisionpoint.com, analysis by TSP Talk
As we mentioned yesterday, if stocks fell from their recent highs, bonds had a better chance of breaking above their recent resistance, and that is what happened. Now there are two levels of support for the bond ETF - the rising support line, and the old resistance line.
Chart provided courtesy of www.decisionpoint.com, analysis by TSP Talk
The April jobs report will be released tomorrow morning. Consensus estimates are in the area of adding 155,000 jobs, and an unemployment rate of 7.6%.
Thanks for reading! We'll see you back here tomorrow.
Tom Crowley
Posted daily at TSP Talk Market Commentary
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.
