07/23/25
It felt like an uneventful day yesterday but despite a loss in the Nasdaq and a flat 4-point gain in the S&P 500, the stock market actually did very well internally, and we saw that with small caps as the S-fund gained 0.72% on the day. Yields and the dollar both fell sharply again and that usually means good things for the S and I-funds, as well as the F-fund.
(The most current commentary is always posted here: www.tsptalk.com/comments.php)
The Equal Weighted S&P 500 (same 500 stocks as the S&P 500) was up 1.27% yesterday so big tech weighed heavily on the major index that dictates our C-fund return, but the S-fund was rewarded as the market breadth was very positive, spreading the wealth among the smaller and broader indices.
All of this is happening while the seasonality calendar says we should be seeing some headwinds this week.
The Magnificent 7 stocks will start reporting earnings today with Tesla and Google reporting after the closing bell, so maybe that will change things? Not according to this whale -- I heard that someone bought $20,000,000 worth of GOOGL 210 calls yesterday. That's a big bet on the upside considering it closed yesterday at 191. I can't confirm it, but I heard it on X so it must be true.
The S&P 500 (C-fund) continues to slide sideways with an upward bias with no signs of volatility recently. It has now closed above its 20-day EMA (green line) for 61 straight days.
This chart shows what happened after it closed above that average for 59 straight days, which was Friday, so day 60 and 61 have been OK this week, mostly flat, but OK. Now here comes day 3 and 4 over that 20 day average, so let's see if this chart's ominous outlook (in the short-term) correctly calls for a slight pause in the rally. The last time it did something like this was in 1999.
Closing above that average for that long is a decent sign for the intermediate-term, although stocks did peak in 2000, but for now it's just a red flag for the next couple of days.
Here's the 10-year Treasury Yield and the dollar falling sharply again, helping those "alternative funds" outperform the S&P 500 / C-fund. The 10-year is trying to find support at its 200-day average. Sometimes it holds and reverses. Sometimes it doesn't.
The dollar seems to be resuming its downward trend after failing at resistance again. Dollar sentiment is extremely low right now which makes me think it may surprise us with a bigger rally at some point soon.
With Mag 7 earnings coming, the Fed meeting next week, as well as the July jobs report next Friday, the market could be getting ready for a change in direction, or it may be ready to change the consolidating action into another leg higher. Place your bets! I'm still on the fence but been raising some cash. The momentum has been too good to just sell everything - as of now.
Update: Since posting this Tuesday evening, an unexpected trade deal between the US and Japan was announced and the stock futures here, and around the world, were up. Japan will pay a 15% tariff, which is down from 25%.
The DWCPF / S-fund had a really nice day after another morning of coming down to test the old resistance line, which has now been holding as support. It could still flip over here and attempt a gap fill, but we'll probably need a negative news headline to change the momentum. Today is now day #6 after that negative outside reversal day which, to my surprise, has been of little consequence so far.
ACWX (I-fund) was up nicely and it made a new high for the year, despite being below that old rising support line, which could now be resistance, but that resistance is rising. The weakness in the dollar is helping out.
BND (bonds / F-fund) had a big day with those yields falling again. This chart looks better since holding at the 50-day average, and getting back above that trading channel. The open gap is there to try to catch any pullbacks.
Thanks so much for reading! We'll see you back here tomorrow.
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 felt like an uneventful day yesterday but despite a loss in the Nasdaq and a flat 4-point gain in the S&P 500, the stock market actually did very well internally, and we saw that with small caps as the S-fund gained 0.72% on the day. Yields and the dollar both fell sharply again and that usually means good things for the S and I-funds, as well as the F-fund.
(The most current commentary is always posted here: www.tsptalk.com/comments.php)
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The Equal Weighted S&P 500 (same 500 stocks as the S&P 500) was up 1.27% yesterday so big tech weighed heavily on the major index that dictates our C-fund return, but the S-fund was rewarded as the market breadth was very positive, spreading the wealth among the smaller and broader indices.
All of this is happening while the seasonality calendar says we should be seeing some headwinds this week.
The Magnificent 7 stocks will start reporting earnings today with Tesla and Google reporting after the closing bell, so maybe that will change things? Not according to this whale -- I heard that someone bought $20,000,000 worth of GOOGL 210 calls yesterday. That's a big bet on the upside considering it closed yesterday at 191. I can't confirm it, but I heard it on X so it must be true.
The S&P 500 (C-fund) continues to slide sideways with an upward bias with no signs of volatility recently. It has now closed above its 20-day EMA (green line) for 61 straight days.
This chart shows what happened after it closed above that average for 59 straight days, which was Friday, so day 60 and 61 have been OK this week, mostly flat, but OK. Now here comes day 3 and 4 over that 20 day average, so let's see if this chart's ominous outlook (in the short-term) correctly calls for a slight pause in the rally. The last time it did something like this was in 1999.
Closing above that average for that long is a decent sign for the intermediate-term, although stocks did peak in 2000, but for now it's just a red flag for the next couple of days.
Here's the 10-year Treasury Yield and the dollar falling sharply again, helping those "alternative funds" outperform the S&P 500 / C-fund. The 10-year is trying to find support at its 200-day average. Sometimes it holds and reverses. Sometimes it doesn't.
The dollar seems to be resuming its downward trend after failing at resistance again. Dollar sentiment is extremely low right now which makes me think it may surprise us with a bigger rally at some point soon.
With Mag 7 earnings coming, the Fed meeting next week, as well as the July jobs report next Friday, the market could be getting ready for a change in direction, or it may be ready to change the consolidating action into another leg higher. Place your bets! I'm still on the fence but been raising some cash. The momentum has been too good to just sell everything - as of now.
Update: Since posting this Tuesday evening, an unexpected trade deal between the US and Japan was announced and the stock futures here, and around the world, were up. Japan will pay a 15% tariff, which is down from 25%.
The DWCPF / S-fund had a really nice day after another morning of coming down to test the old resistance line, which has now been holding as support. It could still flip over here and attempt a gap fill, but we'll probably need a negative news headline to change the momentum. Today is now day #6 after that negative outside reversal day which, to my surprise, has been of little consequence so far.
ACWX (I-fund) was up nicely and it made a new high for the year, despite being below that old rising support line, which could now be resistance, but that resistance is rising. The weakness in the dollar is helping out.
BND (bonds / F-fund) had a big day with those yields falling again. This chart looks better since holding at the 50-day average, and getting back above that trading channel. The open gap is there to try to catch any pullbacks.
Thanks so much for reading! We'll see you back here tomorrow.
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.
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