10/03/25
It was another positive day on Wall Street after day two of the government shutdown. Small caps did particularly well as the S-fund remains volatile but continues to bounce off of support. Trying to figure out when this market is going to rollover is getting to be futile as the bulls remain firmly in control. One day the bears will be right, just as a broken clock is right twice a day, but history suggests when things do turn right, it can be a quick and dramatic event.
Normally we'd be getting the September Monthly Jobs report today and it would be a market mover, but since the government is shutdown, the BLS will not be releasing the report.
The estimates were looking for a gain of 39,000 jobs despite the ADP report on Wednesday showing a 32,000 loss. As I mentioned yesterday, they get their data from a different source, so their guess is as good as ours.
But one thing is clear - the jobs market is getting weaker. Is it the economy, or was it the advent of ChatGPT? This chart has been floating around and it is quite interesting, and perhaps telling.
Caution! This next analysis is probably as useless as it gets, but it reminds us that the market does not always go straight up. Sometimes we need a nudge to remind us that complacency eventually sends us a wake up call.
This is not for the buy and holder, but if you're wondering what you should be doing if you are all in stocks, or if you have a lot of cash on the sidelines and wish you had more invested, keep reading.
There are a few years that we can point to, but I thought 2017 and 2018 were good examples. For about 5 months the S&P 500 was going straight up in 2017. Looks great and unstoppable, right? Until it was stoppable in early 2018.
Later in 2018, another 5 month rally ended with a big thud which led to a near 20% decline - right in the heart of the bullish 4th quarter.
Is that going to happen in 2025? It has been six months since the last 3% decline, let alone a 10% correction or 20% decline like in 2018.
It's difficult to time a runaway market that ignores many of the typically useful indicators, but you know it can't last forever. Until then, enjoy any gains you can still get.
The S&P 500 (C-fund) made another new high on Thursday, the 30th of the year, and there is nothing in the chart that suggests it will stop. Melt ups tend to go longer than a market timer can stand. Just be careful and don't get caught sleeping if we do see some selling that breaks support.
The DWCPF (S-fund) has been volatile lately, but it continues to come out on top. It is retracing the two breakdown candlesticks from September and once that's complete, it will be another test for this chart.
ACWX (I-fund) is back to the top of its ever advancing trading channel. These have led to short-term pullbacks in the past, but the trend is still very strong and the only thing that would be concerning is if the dollar breaks and hold above that sideways channel it is in right now, for any length of time.
BND (bonds / F-fund) is riding up the bottom of the resistance line of its rising trading channel. 74.50 could be resistance with the gap still open below. If it can get above that resistance again, I will stop worrying about that gap.
Thanks so much for reading! Have a great weekend!
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
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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.
It was another positive day on Wall Street after day two of the government shutdown. Small caps did particularly well as the S-fund remains volatile but continues to bounce off of support. Trying to figure out when this market is going to rollover is getting to be futile as the bulls remain firmly in control. One day the bears will be right, just as a broken clock is right twice a day, but history suggests when things do turn right, it can be a quick and dramatic event.
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Normally we'd be getting the September Monthly Jobs report today and it would be a market mover, but since the government is shutdown, the BLS will not be releasing the report.
The estimates were looking for a gain of 39,000 jobs despite the ADP report on Wednesday showing a 32,000 loss. As I mentioned yesterday, they get their data from a different source, so their guess is as good as ours.
But one thing is clear - the jobs market is getting weaker. Is it the economy, or was it the advent of ChatGPT? This chart has been floating around and it is quite interesting, and perhaps telling.
Caution! This next analysis is probably as useless as it gets, but it reminds us that the market does not always go straight up. Sometimes we need a nudge to remind us that complacency eventually sends us a wake up call.
This is not for the buy and holder, but if you're wondering what you should be doing if you are all in stocks, or if you have a lot of cash on the sidelines and wish you had more invested, keep reading.
There are a few years that we can point to, but I thought 2017 and 2018 were good examples. For about 5 months the S&P 500 was going straight up in 2017. Looks great and unstoppable, right? Until it was stoppable in early 2018.
Later in 2018, another 5 month rally ended with a big thud which led to a near 20% decline - right in the heart of the bullish 4th quarter.
Is that going to happen in 2025? It has been six months since the last 3% decline, let alone a 10% correction or 20% decline like in 2018.
It's difficult to time a runaway market that ignores many of the typically useful indicators, but you know it can't last forever. Until then, enjoy any gains you can still get.
The S&P 500 (C-fund) made another new high on Thursday, the 30th of the year, and there is nothing in the chart that suggests it will stop. Melt ups tend to go longer than a market timer can stand. Just be careful and don't get caught sleeping if we do see some selling that breaks support.
The DWCPF (S-fund) has been volatile lately, but it continues to come out on top. It is retracing the two breakdown candlesticks from September and once that's complete, it will be another test for this chart.
ACWX (I-fund) is back to the top of its ever advancing trading channel. These have led to short-term pullbacks in the past, but the trend is still very strong and the only thing that would be concerning is if the dollar breaks and hold above that sideways channel it is in right now, for any length of time.
BND (bonds / F-fund) is riding up the bottom of the resistance line of its rising trading channel. 74.50 could be resistance with the gap still open below. If it can get above that resistance again, I will stop worrying about that gap.
Thanks so much for reading! Have a great weekend!
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.
