Interesting day, that yesterday was

08/23/13

After being down for 6 consecutive days, and 8 of the last 9 days, the Dow gained 66-points on Thursday and the gains were more impressive on the broader indices, particularly the small caps as the S-fund gained 1.26%. All this while bond yields went up?

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[TD="align: center"] Daily TSP Funds Return[TABLE="width: 160"]
[TR]
[TD="align: right"] G-Fund:[/TD]
[TD="align: right"] +0.0056%[/TD]
[/TR]
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[TD="align: right"] F-fund:[/TD]
[TD="align: right"] -0.19%[/TD]
[/TR]
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[TD="align: right"] C-fund:[/TD]
[TD="align: right"] +0.86%[/TD]
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[TD="align: right"] S-fund:[/TD]
[TD="align: right"] +1.26%[/TD]
[/TR]
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[TD="align: right"] I-fund:[/TD]
[TD="align: right"] +0.71%[/TD]
[/TR]
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[TD="align: right"]

More returns​

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The market threw us a few curves yesterday as yields went up and stocks went down. We were getting used to the the to moving in the same direction. Another curve was that the Nasdaq was down (off line) for several hours during the trading day on Thursday. That's very unusual, and what I find even more unusual since the word "hacked" was being thrown around, was that stocks were up impressively despite this information.

The S&P 500 (SPY) stayed below the 50-day EMA again, but not by much. If it can make a move above the 50 EMA, the next level of resistance would be at the top of the new short-term descending trading channel and the top of the open gap.

Chart provided courtesy of www.decisionpoint.com, analysis by TSP Talk

If the S&P 500 is going to follow the leader, the Transports, then we could see a break of the new downward trend. The Transports had a big day on Thursday - jumping 2% and moving above both the 50 and 20-day EMA's. All on light volume, which was interesting.

Chart provided courtesy of www.decisionpoint.com, analysis by TSP Talk

The Nasdaq made a nice move despite that 3+ hours of downtime. These indices seem to feel the need to fill those open gaps, but that would mean bear flags would break to the upside. Not out of the question, but not the common move. The Transports did it and so those gaps may have more of a pull than flags.

Chart provided courtesy of www.decisionpoint.com, analysis by TSP Talk

Continues...

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[TD="align: left"] We interrupt today's commentary with an important announcement:

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The following type of analysis may not be in the free basic daily market commentary, but will be in TSP Talk Plus starting next week. You might want to check it out and make sure you can login now so you don't have any problems trying to get access next week (http:TSP Talk Members' Home Page). See instructions above.

The small caps had a big day and are in the same situation.

Chart provided courtesy of www.decisionpoint.com, analysis by TSP Talk

Just a little follow-up here on the Hindenburg Omen signals. Two weeks after we posted this "11 HO signals within 50 days" stat, the S&P 500 is down 2.4% since the close on August 8. That was inline with the average of the 5 previous occurrences which was -2.6%.

Chart provided courtesy of www.sentimentrader.com, analysis by TSP Talk

Looking out to 1-month after August 8, the average return was still -2.3% so there wasn't much movement average-wise, but each year had different results with some seeing bigger drops (1980 and 2000), while others rebounded (1965 and 2006).

Today is the 17th trading day in August and once again we are hitting a rougher seasonal period going into the end of the month.

Chart provided courtesy of www.sentimentrader.com, analysis by TSP Talk

The 23rd trading day looks pretty good, but this year there are only 22 trading days in August.

Yields moved above 2.9% on the 10-year T-note making yesterday that much more interesting. Everyone has been expecting stocks to drop when yields rise, but I guess it doesn't have to be that way every day. Let's look for a trend before making anything of this.

Chart provided courtesy of www.decisionpoint.com, analysis by TSP Talk


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.

 

[Guest]

Question for ALL: I did an interfund transfer (100%) - from the G fund, to the I fund, effective at COB on Thursday, 8/22/2013. On Friday, 8/23/2013 (i.e., the very next day), the I fund (per its ticker: EFA) gained +0.87% - which was confirmed by StockCharts (EFA, +0.87%), Yahoo Finance (EFA, +0.87%), and my Ameritrade trading account ($DWCPF, +0.87%).

WHY DID MY TSP ONLY INCREASE BY +0.55%?? (net percentage change in EFA (i.e., TSP's "I" fund) from close of business Thursday, 8/22/2013 to COB Friday, 8/23/2013- an UNDERreporting of -0.32% !!!

Could it be that the "EFA" ticker is an approximation of the daily change in the TSP I fund (if so, that's a HUGELY divergent net change difference; as expressed in daily percentage. It's an underreporting of: EFA .87% - TSP .55% / EFA .87% = -0.37 percent net daily UNDERreporting of TSP gain v. the ACTUAL gain as per EFA print price at close of business, Friday 8/23/2013.

Assuming TSP is not trying to cheat us - or is in gross error when stating our daily gains/losses - is there a more accurate ticker than "EFA" that more accurately reflects TSP's "I" fund?

 

[tsptalk]

Let me point you here first...

http://www.tsptalk.com/mb/i-fund/3111-what-fv-how-does-work.html

If you have any more questions after that, let me know.

One thing - the EFA is not the I-fund. They are both tracking the EAFE but have different time periods so they don't always match in the short run. In they long the do.

Here's a good site for EAFE quotes.

MSCI Index Performance - Standard (Large & Mid) - MSCI (You have to click the agree button before seeing the quotes.)