Stocks opened sharply lower yesterday but made several attempts to push toward the break even mark before closing with just modest losses. The Dow gave up 36-points on the day.
[TABLE="width: 90%, align: center"]
[TR]
[TD="width: 241"]
[TD="align: center"] Daily TSP Funds Return[TABLE="width: 80%, align: center"]
[TR]
[TD="align: right"] G-Fund:[/TD]
[TD] +0.012%[/TD]
[/TR]
[TR]
[TD="align: right"] F-fund:[/TD]
[TD] +0.15%[/TD]
[/TR]
[TR]
[TD="align: right"] C-fund:[/TD]
[TD] - 0.16%[/TD]
[/TR]
[TR]
[TD="align: right"] S-fund:[/TD]
[TD] - 0.34%[/TD]
[/TR]
[TR]
[TD="align: right"] I-fund:[/TD]
[TD] - 0.76%[/TD]
[/TR]
[TR]
[TD="colspan: 2, align: right"] [/TD]
[/TR]
[/TABLE]
[/TD]
[/TR]
[/TABLE]
The S&P 500 is still holding onto that falling support line which had been the top of the triangle formation (red). The 20-day EMA remains above the 50-day EMA and the market is working off of the overbought conditions on some light volume.
Chart provided courtesy of www.decisionpoint.com, analysis by TSP Talk
The Dow Transportation Index has been bouncing wildly over the last couple of months and unfortunately is closer to the overhead resistance than to support, although the moving averages are in good shape and could act as support before it reaches the bottom of its triangle formation.
Chart provided courtesy of www.decisionpoint.com, analysis by TSP Talk
There may also be a bull flag forming (blue) and of course that would be bullish.
The put / call ratios show that both the smart money and the dumb money have been getting more bullish over the last couple of weeks. That is a little unusual since the two are more often moving in the opposite direction.
I marked in red a couple other times when both the smart and dumb money were rising (getting more bullish) while both were near current levels or higher.
Chart provided courtesy of www.decisionpoint.com, analysis by TSP Talk
It showed mixed results and none of the other occurrences were quite like the current one, which doesn't give us much to go on. My theory has always been - in case of a tie, go against the dumb money. That is a stronger indicator when we're near extreme readings, and neither of these are overly extreme - although the smart money is getting closer to a multi-year high.
The yield on the 10-year Treasury just cannot gain any traction as the 20-day EMA continues to act as a barrier.
Chart provided courtesy of www.decisionpoint.com, analysis by TSP Talk
Despite yields being near all-time lows, bond prices and the F-fund, which move counter to yields, are still in a bullish position. Until that yields gets above the 20-day and 50_day EMA, we should expect yields to remain in a bear market, which is bullish for the F-fund.
Thanks for reading! We'll see you back here tomorrow.
Tom Crowley
Posted daily at TSP Talk Market Commentary
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