Stocks took a pause on Thursday after the 951-point rally off the lows. The Dow lost 40-points and a modest pullback certainly doesn't seem alarming. There was nothing particularly wrong with the action, but we are in a bear market and unless that is going to change anytime soon, I guess we shouldn't be surprised if we see more bearish action.
[TABLE="width: 89%, align: center"]
[TR]
[TD="width: 180, align: center"]
[/TD]
[TD="width: 49, align: center"][/TD]
[TD="align: center"] Daily TSP Funds Return
[TABLE="width: 69%, align: center"]
[TR]
[TD="align: right"] [/TD]
[/TR]
[/TABLE]
[/TD]
[/TR]
[/TABLE]
Bear market rallies can be explosive as I have been saying, and we got a pretty good one over the last week. The question now is whether it is over. There are some good signs and bad signs out there, and you tend to see that when the bulls and bears are pulling at each other in a situation like this. One is calling for a bottom, and the other is selling the rallies.
The Dow Completion Index (small caps / S-Fund) has rallied 60-points off the low and broke above the 20-day EMA, but that 915 - 920 area could be some tough resistance.
The price of oil gapped up on Thursday and broke above its descending trading channel. That's a bullish sign, but it immediately tested the 50-day EMA and has so far stalled. That open gap may get some attention before any further upside is made.
The Dow Transportation Index broke above two key resistance levels on Wednesday, and on Thursday it pulled back some but basically remained above that old resistance. Like the other charts, it is at an interesting juncture and its next move could be very telling for the rest of the market.
The EFA (EAFE Index / I-fund) was down about a 1/2 of a percent like many indices on Thursday, but I was drawn to the chart of Greece. Greece isn't a major factor in our I-fund, but it can set the tone for the other European markets should it run into more trouble as it has recently. The recent rebound seems to be stalling again at the 20-day EMA and top of the falling trading channel.
The Credit Suisse High Yield Bond Fund broke above a descending wedge pattern, which they end to do. It then rallied sharply but right into the 50-day EMA where it stalled and reversed some. Another interesting pivot point here.
The AGG (bonds / F-fund) bounced back from the bottom of its rising trading channel keeping the uptrend in bonds alive and well.
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
Thanks for reading. Have a great weekend!
Tom Crowley
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.
[TABLE="width: 89%, align: center"]
[TR]
[TD="width: 180, align: center"]
[TD="width: 49, align: center"][/TD]
[TD="align: center"] Daily TSP Funds Return
[TR]
[TD="align: right"] [/TD]
[/TR]
[/TABLE]
[/TD]
[/TR]
[/TABLE]
Bear market rallies can be explosive as I have been saying, and we got a pretty good one over the last week. The question now is whether it is over. There are some good signs and bad signs out there, and you tend to see that when the bulls and bears are pulling at each other in a situation like this. One is calling for a bottom, and the other is selling the rallies.
The SPY (S&P 500 Index / C-Fund) paused on Thursday and I guess the concerning part is where it paused - right at the 50-day EMA and that old support line which may now act as resistance. The 50-day EMA can be a rally killer in a bear market. The next few days could be very important.
The Dow Completion Index (small caps / S-Fund) has rallied 60-points off the low and broke above the 20-day EMA, but that 915 - 920 area could be some tough resistance.
The price of oil gapped up on Thursday and broke above its descending trading channel. That's a bullish sign, but it immediately tested the 50-day EMA and has so far stalled. That open gap may get some attention before any further upside is made.
The Dow Transportation Index broke above two key resistance levels on Wednesday, and on Thursday it pulled back some but basically remained above that old resistance. Like the other charts, it is at an interesting juncture and its next move could be very telling for the rest of the market.
The EFA (EAFE Index / I-fund) was down about a 1/2 of a percent like many indices on Thursday, but I was drawn to the chart of Greece. Greece isn't a major factor in our I-fund, but it can set the tone for the other European markets should it run into more trouble as it has recently. The recent rebound seems to be stalling again at the 20-day EMA and top of the falling trading channel.
The Credit Suisse High Yield Bond Fund broke above a descending wedge pattern, which they end to do. It then rallied sharply but right into the 50-day EMA where it stalled and reversed some. Another interesting pivot point here.
The AGG (bonds / F-fund) bounced back from the bottom of its rising trading channel keeping the uptrend in bonds alive and well.
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
Thanks for reading. Have a great weekend!
Tom Crowley
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.
