07/11/13
Stocks were mixed yesterday with the Dow falling 9-points, the S&P and small caps adding small gains, and a solid pickup for the I-fund, while bonds were hit hard again.
[TABLE="width: 88%, align: center"]
[TR]
[TD="width: 305"]
[TD="align: center"] Daily TSP Funds Return[TABLE="width: 155"]
[TR]
[TD="align: right"] G-Fund:[/TD]
[TD="align: right"] +0.0057%[/TD]
[/TR]
[TR]
[TD="align: right"] F-fund:[/TD]
[TD="align: right"] -0.23%[/TD]
[/TR]
[TR]
[TD="align: right"] C-fund:[/TD]
[TD="align: right"] +0.03%[/TD]
[/TR]
[TR]
[TD="align: right"] S-fund:[/TD]
[TD="align: right"] +0.15%[/TD]
[/TR]
[TR]
[TD="align: right"] I-fund:[/TD]
[TD="align: right"] +0.72%[/TD]
[/TR]
[/TABLE]
[TABLE="width: 80%, align: center"]
[TR]
[TD="align: right"] [/TD]
[/TR]
[/TABLE]
[/TD]
[/TR]
[/TABLE]
We saw some intraday afternoon volatility after the Fed minutes were released, but aside from that it was a rather dull day. However, the story didn't end at the close.
After the close the Fed said that a highly accommodative monetary policy is needed for the foreseeable future and that the U.S. unemployment rate at 7.6 percent may be overstating the job market's health. They basically said the central bank will continue buying bonds until the labor market outlook improves substantially.
That sent the after hours futures soaring and as of this writing Wednesday night, the Dow futures are up 116-points. The market can't seem to lose. Now both positive and negative economic news is sending the indices higher.
The new trend is up as the downside trend may be over after 3 closes above the resistance lines. I like to give 3 to 5 days for it to be official, so unless we see a sharp move lower before the end of the week, it's looking bullish. The SPY has now closed above the 50-day EMA for 5 straight days.
Chart provided courtesy of www.decisionpoint.com, analysis by TSP Talk
The QQQ (Nasdaq 100) has now been up 11 straight days and the futures are up another 0.80% going into Thursday. What else can you say? Overbought and due for a pullback, but bullish action.
Chart provided courtesy of www.decisionpoint.com, analysis by TSP Talk
Surprisingly, the NYSE is not that overbought sitting at +405. But it did come from -800 to get to +405 so that might be considered an overbought run.
Chart provided courtesy of www.decisionpoint.com, analysis by TSP Talk
There was one interesting reading after yesterday's trading. The smart money of the OEX put/call ratio put in a large one-day bearish spike - the second most bearish daily ratio of the year.
Chart provided courtesy of www.decisionpoint.com, analysis by TSP Talk
One day readings aren't usually something to be concerned about, but this one did send the 10-day EMA down quite a bit, and that's the one I watch. The EMA is not in a danger zone yet, but perhaps the smart money is going to start using strength to get more defensive so that they are most protected once we hit a peak..
Thanks for reading! We'll see you back here tomorrow.
Tom Crowley
Posted daily at TSP Talk Market Commentary
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