08/14/12
It was another relatively flat day for stocks yesterday as all of the TSP funds moved less than 0.2%. But the day was not without a little excitement as the indices rallied from early losses to put in yet another reversal day, but the flat top remains.
[TABLE="align: center"]
[TR]
[TD]
[/TD]
[TD="align: center"] Daily TSP Funds Return
[TABLE="align: center"]
[TR]
[TD="align: right"] G-Fund:
[/TD]
[TD] +0.01%
[/TD]
[/TR]
[TR]
[TD="align: right"] F-fund:
[/TD]
[TD] - 0.01%
[/TD]
[/TR]
[TR]
[TD="align: right"] C-fund:
[/TD]
[TD] - 0.11%
[/TD]
[/TR]
[TR]
[TD="align: right"] S-fund:
[/TD]
[TD] - 0.18%
[/TD]
[/TR]
[TR]
[TD="align: right"] I-fund:
[/TD]
[TD] - 0.13%
[/TD]
[/TR]
[TR]
[TD="colspan: 2, align: right"]
[/TD]
[/TR]
[/TABLE]
[/TD]
[/TR]
[/TABLE]
For the S&P 500, which closed down 0.1%, the rising wedge and the flat top still dominate the patterns. Volume continues to dry up.
Chart provided courtesy of www.decisionpoint.com, analysis by TSP Talk
The oscillator / overbought / oversold type indicators look to be peaking at this time and starting to roll over. A nice little pullback could make this a little more attractive, but I am still concerned about the rising wedge, which is a bearish formation.
Chart provided courtesy of www.decisionpoint.com, analysis by TSP Talk
Rather than a bearish flat top, the small caps have actually produced a bull flag, which is a bullish formation. The early losses saw the Russell 2000 drop down to the 20-day EMA, but it reversed nicely and put in a positive reversal day.
Chart provided courtesy of www.decisionpoint.com, analysis by TSP Talk
Here's more good news (the bad will follow):
Stanford University students and professors made an attempt to quantifying the uncertainty about economic policies. They've developed a model of based on three factors:
- Newspaper coverage of economic policies
- A measure of expiring tax code provisions
- Dispersion between economists' predictions
According to their models, the current mood is showing some of the highest uncertainty in almost 30 years. And that may be a good thing.
Chart provided courtesy of www.sentimentrader.com
Here's the bad news: The VIX is down below 14.0 for the first time in more than a year. SentimenTrader.com says that (being below 14.0 for a 1st time in a year) has only occurred twice before in the indicator's 25-year history, on 11/13/91 and 6/23/04. The S&P 500 topped out almost immediately both times, then declined about 5% during the next 10 and 30 days, respectively.
Chart provided courtesy of www.decisionpoint.com, analysis by TSP Talk
The S&P 500 bottomed after the pullback and went on to new highs over the next several months. So this goes along with what I mentioned yesterday. A short-term pullback seems likely, but sentiment is so bearish that it is bullish for stocks. In other words, buying the pullbacks should still work in this market.
Thanks for reading! We'll see you back here tomorrow.
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.
It was another relatively flat day for stocks yesterday as all of the TSP funds moved less than 0.2%. But the day was not without a little excitement as the indices rallied from early losses to put in yet another reversal day, but the flat top remains.
[TABLE="align: center"]
[TR]
[TD]
[TD="align: center"] Daily TSP Funds Return
[TABLE="align: center"]
[TR]
[TD="align: right"] G-Fund:
[/TD]
[TD] +0.01%
[/TD]
[/TR]
[TR]
[TD="align: right"] F-fund:
[/TD]
[TD] - 0.01%
[/TD]
[/TR]
[TR]
[TD="align: right"] C-fund:
[/TD]
[TD] - 0.11%
[/TD]
[/TR]
[TR]
[TD="align: right"] S-fund:
[/TD]
[TD] - 0.18%
[/TD]
[/TR]
[TR]
[TD="align: right"] I-fund:
[/TD]
[TD] - 0.13%
[/TD]
[/TR]
[TR]
[TD="colspan: 2, align: right"]
[/TD]
[/TR]
[/TABLE]
[/TD]
[/TR]
[/TABLE]
For the S&P 500, which closed down 0.1%, the rising wedge and the flat top still dominate the patterns. Volume continues to dry up.
Chart provided courtesy of www.decisionpoint.com, analysis by TSP Talk
The oscillator / overbought / oversold type indicators look to be peaking at this time and starting to roll over. A nice little pullback could make this a little more attractive, but I am still concerned about the rising wedge, which is a bearish formation.
Chart provided courtesy of www.decisionpoint.com, analysis by TSP Talk
Rather than a bearish flat top, the small caps have actually produced a bull flag, which is a bullish formation. The early losses saw the Russell 2000 drop down to the 20-day EMA, but it reversed nicely and put in a positive reversal day.
Chart provided courtesy of www.decisionpoint.com, analysis by TSP Talk
Here's more good news (the bad will follow):
Stanford University students and professors made an attempt to quantifying the uncertainty about economic policies. They've developed a model of based on three factors:
- Newspaper coverage of economic policies
- A measure of expiring tax code provisions
- Dispersion between economists' predictions
According to their models, the current mood is showing some of the highest uncertainty in almost 30 years. And that may be a good thing.
Chart provided courtesy of www.sentimentrader.com
Here's the bad news: The VIX is down below 14.0 for the first time in more than a year. SentimenTrader.com says that (being below 14.0 for a 1st time in a year) has only occurred twice before in the indicator's 25-year history, on 11/13/91 and 6/23/04. The S&P 500 topped out almost immediately both times, then declined about 5% during the next 10 and 30 days, respectively.
Chart provided courtesy of www.decisionpoint.com, analysis by TSP Talk
The S&P 500 bottomed after the pullback and went on to new highs over the next several months. So this goes along with what I mentioned yesterday. A short-term pullback seems likely, but sentiment is so bearish that it is bullish for stocks. In other words, buying the pullbacks should still work in this market.
Thanks for reading! We'll see you back here tomorrow.
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.
