11/16/12
The indices struggled all day, making a couple of attempts to move into positive territory, but each time sellers stepped up and by the close we saw modest losses all around. The Dow was down 29-points.
[TABLE="width: 88%, align: center"]
[TR]
[TD="width: 241"]
[TD="align: center"] Daily TSP Funds Return[TABLE="width: 167"]
[TR]
[TD="align: right"] G-Fund:[/TD]
[TD="align: right"] 0.0036%[/TD]
[/TR]
[TR]
[TD="align: right"] F-fund:[/TD]
[TD="align: right"] -0.02%[/TD]
[/TR]
[TR]
[TD="align: right"] C-fund:[/TD]
[TD="align: right"] -0.15%[/TD]
[/TR]
[TR]
[TD="align: right"] S-fund:[/TD]
[TD="align: right"] -0.41%[/TD]
[/TR]
[TR]
[TD="align: right"] I-fund:[/TD]
[TD="align: right"] 0.30%[/TD]
[/TR]
[/TABLE]
[TABLE="width: 80%, align: center"]
[TR]
[TD="align: right"] [/TD]
[/TR]
[/TABLE]
[/TD]
[/TR]
[/TABLE]
The S&P 500 remains below the 200-day EMA for a 2nd straight day (technically 3, but the first day was by a few cents). One of the longer-term trendlines was broken yesterday, and while it might be nit-picky to call this a breakdown at this point, it is what it is. That rising support line seemed to act as resistance on Thursday so the S&P 500 will have to rally above 1360 Friday to void this breakdown.
Chart provided courtesy of www.decisionpoint.com, analysis by TSP Talk
The Nasdaq, one of the leaders, broke that same trend a while back, as did many of the other major indices. It is well below the 200-day EMA and not looking very good.
Chart provided courtesy of www.decisionpoint.com, analysis by TSP Talk
About the only positive we can say at this time is that it may just be bad enough to get a relief rally. Either that or we will see an all out collapse as fear over the fiscal cliff escalates, and now violence on the Israeli border is intensifying.
The put / call ratios show the fear in the dumb money (usually a bullish sign) but as you can see that bearishness can get lower.
Chart provided courtesy of www.decisionpoint.com, analysis by TSP Talk
The smart money continues to get less defensive as they are preparing for a bounce, although they've been on the wrong side for a couple of weeks now.
The Talk Sentiment Survey came in at 34% bulls, 59% bears, for a bulls to bears ratio of 0.58 to 1. That is a Buy signal which means the system will remain in a 100% S fund allocation for the week of 11/19/12 - 11/23/12.
sentimeTrader.com's chart of all of their indicators at extreme levels shows none of their indicators are exetremely bearish, while 21% of them are extremely bullish.
Chart provided courtesy of www.sentimentrader.com
This indicates that we "should" see some relief soon, but the question always is, how much more damage can we see before it comes? Momentum is on the downside and the possibility of an outright crash is possible in this kind of environment. But crashes are rare and the only way to prepare to to get out of the way. And if we don't see that rare market crash, we will likely see a sharp spike higher and those on the sidelines will miss it. That's a personal decision based on your tolerance for risk.
Thanks for reading! Have a great weekend!
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.
