Stocks rallied back on Friday after a scare from bank stocks on Thursday. But Deutsche Bank's stock, where all eye were watching, jumped 14% on the day after it appeared they will be able to dodge a bullet and remain solvent, although nothing is certain yet. The Dow gained 165-points Friday, although it was up well over 200 with just minutes to go before some late selling before the closing bell.
[TABLE="width: 89%, align: center"]
[TR]
[TD="width: 180, align: center"]
[TD][/TD]
[TD="align: center"] Daily TSP Funds Return
[TR]
[TD="align: right"] [/TD]
[/TR]
[/TABLE]
[/TD]
[/TR]
[/TABLE]
Earnings season will kick off next week so again the market is looking for a catalyst until then. Last week it was the Fed hangover, followed by a jump in the price of oil, and then the European Bank situation. We will end the week with the September jobs report on Friday so the volatility may continue. With the next decision on interest rates not until December (although there is a very small chance they could act in November), and a rate hike basically already priced in, the only surprised may be a weak jobs report which would lessen the chances of a that hike, but is anyone expecting a weak report weeks in front of the election at this point?
So we just finished September, historically the weakest month of the year, and all of the TSP stock funds finished with a monthly gains. The C, S, and I funds added 0.02%, 0.90% and 1.24% respectively, so the market appears to be holding up well dodging that September obstacle.
The SPY (S&P 500 / C-Fund) continues to move higher off the early September Fed inflicted lows, and it nears the apex of a pennant formation. The bear flag can probably be ruled out at this point, but that doesn't necessarily mean the pennant will break to the upside, although it looks fairly good here.
The weekly chart still looks good. Last week was an inside week and we didn't make a higher high (or lower low), but that's not bad in a rising trend.
The DWCPF (small caps) finished the month with a 0.90% gain and like many indices, it is in a pennant formation. A pennant tends to break in the direction of the larger trend that it was in before the pennant, so technical analysis would have us believe the odds favors an upside breakout this week.
The Dow Transportation Index has been performing well of late and looks to want to breakout out of the large inverted head and shoulders pattern that we have been watching form for months.
The Nasdaq 100 (QQQ) is flirting with new all-time highs and may also be looking to breakout of a smaller inverted head and shoulders pattern.
The EFA (I-find) is also performing well considering all of the issues we have been hearing about in Europe.
The AGG (Bonds / F-fund) was down on Friday and remains in its stubborn trading channel. We know rates are more likely to go up than down so I would think the upside in bonds (since price moves counter to yields) is limited.
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
Thanks for reading. We'll see you back here tomorrow.
Tom Crowley
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 use additional methods and strategies to determine fund positions.
