1/18/13
Stocks rallied yesterday with some major indices hitting levels not seen in five years. The Dow gained 85-points while small caps led the way.
[TABLE="width: 88%, align: center"]
[TR]
[TD]
[/TD]
[TD="align: center"]Daily TSP Funds Return[TABLE="width: 146"]
[TR]
[TD]G-Fund:[/TD]
[TD="align: right"]0.0043%[/TD]
[/TR]
[TR]
[TD]F-fund:[/TD]
[TD="align: right"]-0.18%[/TD]
[/TR]
[TR]
[TD]C-fund:[/TD]
[TD="align: right"]0.57%[/TD]
[/TR]
[TR]
[TD]S-fund:[/TD]
[TD="align: right"]0.79%[/TD]
[/TR]
[TR]
[TD]I-fund:[/TD]
[TD="align: right"]1.04%[/TD]
[/TR]
[/TABLE]
[TABLE="width: 80%, align: center"]
[TR]
[TD="align: right"]More returns[/TD]
[/TR]
[/TABLE]
[/TD]
[/TR]
[/TABLE]
The 5-day flat top on the S&P 500 finally broke, and while flat tops normally break down, the chart was looking quite strong and this break to the upside is not a surprise. This keeps the flag formation intact and the ascending trading channel looks like it will continue.
Chart provided courtesy of www.decisionpoint.com, analysis by TSP Talk
This recent break out took the S&P above not only the recent flat top, but also above the September high, and when strong resistance is broken, it can act as support so we'll see.
Chart provided courtesy of www.decisionpoint.com, analysis by TSP Talk
I have been mentioning the 1490 - 1500 level as some possible resistance to this rally, and this is one of the main reasons...
Chart provided courtesy of www.decisionpoint.com, analysis by TSP Talk
The top of the intermediate-term trend (blue wedge) is close to being tested and that is near the 1490-1500 area. With the bottom of that wedge and the 50-day EMA sitting below 1400, there is potential for a significant pullback soon. But the long-term rising trading channel (red) has a lot of room on both the upside and downside, so which end will be tested first is tough to guess. The only way to call that one is to see which way the intermediate-term wedge (blue) breaks.
I won't go into any of the indicators since chart formations trump indicators and the charts are bullish while the indicators are mixed. Once the charts start hitting resistance, we'll see if the indicators concur and it will be easier to position ourselves for a pullback. With the S&P already above 1480, that resistance could be tested as soon as next week.
The TSP Talk Sentiment Survey was showing a buy signal early on Thursday, but as the day went on and the market rallied, our readers became more and more bullish and by the time the survey closed, the reading was neutral with a 1.32 to 1 bulls (50%) to bears (38%) ratio. That means the system will remain in the G fund for next week.
Thanks for reading! Have a great weekend!
Tom Crowley
Posted daily at www.tsptalk.com/comments.html
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 rallied yesterday with some major indices hitting levels not seen in five years. The Dow gained 85-points while small caps led the way.
[TABLE="width: 88%, align: center"]
[TR]
[TD]
[TD="align: center"]Daily TSP Funds Return[TABLE="width: 146"]
[TR]
[TD]G-Fund:[/TD]
[TD="align: right"]0.0043%[/TD]
[/TR]
[TR]
[TD]F-fund:[/TD]
[TD="align: right"]-0.18%[/TD]
[/TR]
[TR]
[TD]C-fund:[/TD]
[TD="align: right"]0.57%[/TD]
[/TR]
[TR]
[TD]S-fund:[/TD]
[TD="align: right"]0.79%[/TD]
[/TR]
[TR]
[TD]I-fund:[/TD]
[TD="align: right"]1.04%[/TD]
[/TR]
[/TABLE]
[TABLE="width: 80%, align: center"]
[TR]
[TD="align: right"]More returns[/TD]
[/TR]
[/TABLE]
[/TD]
[/TR]
[/TABLE]
The 5-day flat top on the S&P 500 finally broke, and while flat tops normally break down, the chart was looking quite strong and this break to the upside is not a surprise. This keeps the flag formation intact and the ascending trading channel looks like it will continue.
Chart provided courtesy of www.decisionpoint.com, analysis by TSP Talk
This recent break out took the S&P above not only the recent flat top, but also above the September high, and when strong resistance is broken, it can act as support so we'll see.
Chart provided courtesy of www.decisionpoint.com, analysis by TSP Talk
I have been mentioning the 1490 - 1500 level as some possible resistance to this rally, and this is one of the main reasons...
Chart provided courtesy of www.decisionpoint.com, analysis by TSP Talk
The top of the intermediate-term trend (blue wedge) is close to being tested and that is near the 1490-1500 area. With the bottom of that wedge and the 50-day EMA sitting below 1400, there is potential for a significant pullback soon. But the long-term rising trading channel (red) has a lot of room on both the upside and downside, so which end will be tested first is tough to guess. The only way to call that one is to see which way the intermediate-term wedge (blue) breaks.
I won't go into any of the indicators since chart formations trump indicators and the charts are bullish while the indicators are mixed. Once the charts start hitting resistance, we'll see if the indicators concur and it will be easier to position ourselves for a pullback. With the S&P already above 1480, that resistance could be tested as soon as next week.
The TSP Talk Sentiment Survey was showing a buy signal early on Thursday, but as the day went on and the market rallied, our readers became more and more bullish and by the time the survey closed, the reading was neutral with a 1.32 to 1 bulls (50%) to bears (38%) ratio. That means the system will remain in the G fund for next week.
Thanks for reading! Have a great weekend!
Tom Crowley
Posted daily at www.tsptalk.com/comments.html
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.
