04/02/26
We saw some positive follow through on Wednesday morning, and some gains held, but clearly FOMO was on hold as the indices faded late in the day, and resistance areas are still holding. For now, the action still has the characteristics of the proverbial dead cat bounce. Fridays have been brutal for the stock market lately, so with the stock market closed this Friday, today (Thursday) will be tested.
Friday is a holiday this week and with the recent strong pattern of the stock market selling off going into the weekend, what does that mean for Thursday heading into a 3-day weekend for the stock market?
That may all depend on how the world interprets President Trump's address on Wednesday night to the Iran situation - and I am writing this before that begins so there has been no overnight reaction yet. There's little doubt that he will say something "bearish", but the question is whether investors are, literally and figuratively, buying what he is saying.
What's on the bears' mind is what happened last year after the tariff tantrum came and went and stocks soared for months. Investor sentiment had been very bearish recently, but nobody wants to stay too negative and miss out on a comeback rally, which was very common for money managers last year when they lagged the returns of the market indices.
The S&P 500 (C-fund) had some good news, and some bad news. The good news, other than the 0.72% gain, was that it broke above its descending trading channel with that gain on Wednesday. The bad news is, it failed at the key 200-day moving average, and nearly every portfolio manger in the world is looking that. For them, "Should I buy or should I take profits?", will be determined by which side of that line the index trades. Right now it is still below it and has been for the last 9 trading days.
DWCPF (S-fund) blasted above both the trading channel and the 200-day average yesterday... until the index faded into the close and now it is again just an index in a downtrend. Perhaps Trump's address on Wednesday evening can change that, but often the chart action dictates the news.
The Dow also failed at key resistance yesterday, so the dead cat bounce theory remains alive until proven otherwise.
The weekly charts of the S&P 500 and Nasdaq 100 are still flirting with long-term support, with the S&P just above the red support line , but it is currently 11-points below the 40-week average...
... while the Nasdaq 100 had broken below both lines in the sand, but has since just barely recaptured the red line after this 2-day rally. You can tell by the tariff tantrum market that it can get worse before getting better if support does not hold.
Some markets are easier to analyze than others. Chart A looks pretty bullish and there's no reason to anticipate a breakdown. Chart B however has already broken down. Has it bottomed? Started a new downtrend? Chopping around? It's obviously a tougher situation, and that's the kind of situation we are in right now.
The 10-year Treasury Yield was up yesterday so it looks like that old broken resistance is trying to hold as support. The F-fund will need this to get back below that support since bonds and the F-fund move in the opposite direction of yields.
The dollar was down yesterday, although it closed near its highs of the day in an effort to try to fill in the opening gap. This loss in the dollar helped the I-fund lead yesterday.
This could be pre-holiday activity where the market trend can reverse before a major market holiday, then resume that larger trend afterward, so that is always a possibility.
We will get the March jobs report on Friday. Estimates are looking for a gain of about 55,000 jobs and an unemployment rate of 4.4%.
From tsp.gov: "Holiday Closing - Some financial markets will be closed on Friday, April 3, in observance of Good Friday. Consequently, the Thrift Savings Plan will not be updating share prices in any of the TSP funds for that day. Transactions that would have been processed Friday night (April 3) will be processed Monday night (April 6) at Monday's closing share prices."
Congratulations to Tailgate, Udflyer01, and FLtiger for taking down the top 3 spots in the AutoTracker in March with returns of +2.20%, +1.60%, and +1.11% respectively! More information.
Additional TSP Fund Charts:
ACWX (I-fund) led with the help of a weak dollar, and the fact that many international markets closed before the US. market faded later in the day. Of course the TSP determines the price and it can be unpredictable. The good news, the chart looks a lot better after yesterday, than it did a couple of days before.
BND (bonds / F-fund) was basically flat yesterday and remains below the resistance of the bottom of the wedge formation, and the 50-day moving average. A chartist might expect this to rollover next, and that may be what ends up happening, but with so much being at the mercy of the geopolitical headlines, who knows?
Thanks so much for reading! Happy Easter and 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 use additional methods and strategies to determine fund positions.
We saw some positive follow through on Wednesday morning, and some gains held, but clearly FOMO was on hold as the indices faded late in the day, and resistance areas are still holding. For now, the action still has the characteristics of the proverbial dead cat bounce. Fridays have been brutal for the stock market lately, so with the stock market closed this Friday, today (Thursday) will be tested.
| Daily TSP Funds Return More returns |
Friday is a holiday this week and with the recent strong pattern of the stock market selling off going into the weekend, what does that mean for Thursday heading into a 3-day weekend for the stock market?
That may all depend on how the world interprets President Trump's address on Wednesday night to the Iran situation - and I am writing this before that begins so there has been no overnight reaction yet. There's little doubt that he will say something "bearish", but the question is whether investors are, literally and figuratively, buying what he is saying.
What's on the bears' mind is what happened last year after the tariff tantrum came and went and stocks soared for months. Investor sentiment had been very bearish recently, but nobody wants to stay too negative and miss out on a comeback rally, which was very common for money managers last year when they lagged the returns of the market indices.
The S&P 500 (C-fund) had some good news, and some bad news. The good news, other than the 0.72% gain, was that it broke above its descending trading channel with that gain on Wednesday. The bad news is, it failed at the key 200-day moving average, and nearly every portfolio manger in the world is looking that. For them, "Should I buy or should I take profits?", will be determined by which side of that line the index trades. Right now it is still below it and has been for the last 9 trading days.
DWCPF (S-fund) blasted above both the trading channel and the 200-day average yesterday... until the index faded into the close and now it is again just an index in a downtrend. Perhaps Trump's address on Wednesday evening can change that, but often the chart action dictates the news.
The Dow also failed at key resistance yesterday, so the dead cat bounce theory remains alive until proven otherwise.
The weekly charts of the S&P 500 and Nasdaq 100 are still flirting with long-term support, with the S&P just above the red support line , but it is currently 11-points below the 40-week average...
... while the Nasdaq 100 had broken below both lines in the sand, but has since just barely recaptured the red line after this 2-day rally. You can tell by the tariff tantrum market that it can get worse before getting better if support does not hold.
Some markets are easier to analyze than others. Chart A looks pretty bullish and there's no reason to anticipate a breakdown. Chart B however has already broken down. Has it bottomed? Started a new downtrend? Chopping around? It's obviously a tougher situation, and that's the kind of situation we are in right now.
The 10-year Treasury Yield was up yesterday so it looks like that old broken resistance is trying to hold as support. The F-fund will need this to get back below that support since bonds and the F-fund move in the opposite direction of yields.
The dollar was down yesterday, although it closed near its highs of the day in an effort to try to fill in the opening gap. This loss in the dollar helped the I-fund lead yesterday.
This could be pre-holiday activity where the market trend can reverse before a major market holiday, then resume that larger trend afterward, so that is always a possibility.
We will get the March jobs report on Friday. Estimates are looking for a gain of about 55,000 jobs and an unemployment rate of 4.4%.
From tsp.gov: "Holiday Closing - Some financial markets will be closed on Friday, April 3, in observance of Good Friday. Consequently, the Thrift Savings Plan will not be updating share prices in any of the TSP funds for that day. Transactions that would have been processed Friday night (April 3) will be processed Monday night (April 6) at Monday's closing share prices."
Congratulations to Tailgate, Udflyer01, and FLtiger for taking down the top 3 spots in the AutoTracker in March with returns of +2.20%, +1.60%, and +1.11% respectively! More information.
Additional TSP Fund Charts:
ACWX (I-fund) led with the help of a weak dollar, and the fact that many international markets closed before the US. market faded later in the day. Of course the TSP determines the price and it can be unpredictable. The good news, the chart looks a lot better after yesterday, than it did a couple of days before.
BND (bonds / F-fund) was basically flat yesterday and remains below the resistance of the bottom of the wedge formation, and the 50-day moving average. A chartist might expect this to rollover next, and that may be what ends up happening, but with so much being at the mercy of the geopolitical headlines, who knows?
Thanks so much for reading! Happy Easter and 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 use additional methods and strategies to determine fund positions.
