06/18/13
It was another triple digit move for the Dow on Monday; this one up, although there was mid-day scare that saw the early 190-point gain almost completely vanish in late afternoon trading. But stocks regained strength toward the close and the Dow ended the day up 110-points.
[TABLE="width: 88%, align: center"]
[TR]
[TD="width: 305"]
[/TD]
[TD="align: center"] Daily TSP Funds Return[TABLE="width: 152"]
[TR]
[TD="align: right"] G-Fund:[/TD]
[TD="align: right"] +0.0142%[/TD]
[/TR]
[TR]
[TD="align: right"] F-fund:[/TD]
[TD="align: right"] -0.14%[/TD]
[/TR]
[TR]
[TD="align: right"] C-fund:[/TD]
[TD="align: right"] +0.76%[/TD]
[/TR]
[TR]
[TD="align: right"] S-fund:[/TD]
[TD="align: right"] +0.55%[/TD]
[/TR]
[TR]
[TD="align: right"] I-fund:[/TD]
[TD="align: right"] +1.09%[/TD]
[/TR]
[/TABLE]
[TABLE="width: 80%, align: center"]
[TR]
[TD="align: right"] [/TD]
[/TR]
[/TABLE]
[/TD]
[/TR]
[/TABLE]
This is how RevShark described the volatile afternoon action.
"We were drifting along on solid breadth when a Financial Times article hit in which the author speculated that Ben Bernanke would lay the ground work for some tapering off of bond buying later this week. That sent us down close to flat before the author tweeted that he really had no special insight and people need to “chill out”.
"The message, if it wasn’t already very clear, is that this market is highly sensitive to any talk about ‘tapering’. The bulls keep saying that the market is overacting to this speculation but the market obviously views any pullback by the Fed to be an extremely significant event."
The S&P 500 pushed above the triangle formation but as we have mentioned many times, the initial break from a triangle or wedge formation is often a fake-out, so we don't have too much to go on yet. If the index stays above the triangle for 3 days, it would generally be bullish, but the 1987 chart may dispute that. I'll get to that below.
Chart provided courtesy of www.decisionpoint.com, analysis by TSP Talk
The Nasdaq 100 also poked its head above the descending resistance line, but one thing I didn't notice until today was that this index found support right at the bottom of the open gap created by that big jobs report in early May. I like when gaps hold, and this is a pretty bullish sign.
Chart provided courtesy of www.decisionpoint.com, analysis by TSP Talk
Despite the big gain in the Dow, S&P, and Nasdaq, the market leading Dow Transportation Index closed down on the day. Overhead resistance may be a problem here, but the 50-day EMA acted as support again. This is quite a battle going on here.
Chart provided courtesy of www.decisionpoint.com, analysis by TSP Talk
So how did yesterday's action measure up to the 1987 comparison we have been following?
Chart provided courtesy of www.decisionpoint.com, analysis by TSP Talk
The above 2013 chart comparison is shown in the larger purple square box below on the 1987 chart. The smaller box at the end of the larger box represents where today's market might be.
Chart provided courtesy of www.decisionpoint.com, analysis by TSP Talk
The chances of it playing out exactly are likely zero, but if it's close, look for a possible FOMC meeting generated spike up this week, followed by a lower high peak.
Again, this is not a prediction of a crash. It is for entertainment purposes, but with a "why not pay attention to it" warning, since the formation is so similar.
Bonds backed off from overhead resistance on Monday giving the F-fund another down day. It looks like the trend is remaining down for now.
Chart provided courtesy of www.decisionpoint.com, analysis by TSP Talk
The FOMC meeting starts today and goes into Wednesday with Ben Bernanke giving a press conference on Wednesday.
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.
It was another triple digit move for the Dow on Monday; this one up, although there was mid-day scare that saw the early 190-point gain almost completely vanish in late afternoon trading. But stocks regained strength toward the close and the Dow ended the day up 110-points.
[TABLE="width: 88%, align: center"]
[TR]
[TD="width: 305"]
[TD="align: center"] Daily TSP Funds Return[TABLE="width: 152"]
[TR]
[TD="align: right"] G-Fund:[/TD]
[TD="align: right"] +0.0142%[/TD]
[/TR]
[TR]
[TD="align: right"] F-fund:[/TD]
[TD="align: right"] -0.14%[/TD]
[/TR]
[TR]
[TD="align: right"] C-fund:[/TD]
[TD="align: right"] +0.76%[/TD]
[/TR]
[TR]
[TD="align: right"] S-fund:[/TD]
[TD="align: right"] +0.55%[/TD]
[/TR]
[TR]
[TD="align: right"] I-fund:[/TD]
[TD="align: right"] +1.09%[/TD]
[/TR]
[/TABLE]
[TABLE="width: 80%, align: center"]
[TR]
[TD="align: right"] [/TD]
[/TR]
[/TABLE]
[/TD]
[/TR]
[/TABLE]
This is how RevShark described the volatile afternoon action.
"We were drifting along on solid breadth when a Financial Times article hit in which the author speculated that Ben Bernanke would lay the ground work for some tapering off of bond buying later this week. That sent us down close to flat before the author tweeted that he really had no special insight and people need to “chill out”.
"The message, if it wasn’t already very clear, is that this market is highly sensitive to any talk about ‘tapering’. The bulls keep saying that the market is overacting to this speculation but the market obviously views any pullback by the Fed to be an extremely significant event."
The S&P 500 pushed above the triangle formation but as we have mentioned many times, the initial break from a triangle or wedge formation is often a fake-out, so we don't have too much to go on yet. If the index stays above the triangle for 3 days, it would generally be bullish, but the 1987 chart may dispute that. I'll get to that below.
Chart provided courtesy of www.decisionpoint.com, analysis by TSP Talk
The Nasdaq 100 also poked its head above the descending resistance line, but one thing I didn't notice until today was that this index found support right at the bottom of the open gap created by that big jobs report in early May. I like when gaps hold, and this is a pretty bullish sign.
Chart provided courtesy of www.decisionpoint.com, analysis by TSP Talk
Despite the big gain in the Dow, S&P, and Nasdaq, the market leading Dow Transportation Index closed down on the day. Overhead resistance may be a problem here, but the 50-day EMA acted as support again. This is quite a battle going on here.
Chart provided courtesy of www.decisionpoint.com, analysis by TSP Talk
So how did yesterday's action measure up to the 1987 comparison we have been following?
Chart provided courtesy of www.decisionpoint.com, analysis by TSP Talk
The above 2013 chart comparison is shown in the larger purple square box below on the 1987 chart. The smaller box at the end of the larger box represents where today's market might be.
Chart provided courtesy of www.decisionpoint.com, analysis by TSP Talk
The chances of it playing out exactly are likely zero, but if it's close, look for a possible FOMC meeting generated spike up this week, followed by a lower high peak.
Again, this is not a prediction of a crash. It is for entertainment purposes, but with a "why not pay attention to it" warning, since the formation is so similar.
Bonds backed off from overhead resistance on Monday giving the F-fund another down day. It looks like the trend is remaining down for now.
Chart provided courtesy of www.decisionpoint.com, analysis by TSP Talk
The FOMC meeting starts today and goes into Wednesday with Ben Bernanke giving a press conference on Wednesday.
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.
