Stocks were mostly higher on Wednesday but it was anything but bullish. A late sell-off wiped out much of the big early gains turning a 1% - 2% gains into just modest gains, and in the case of thee Dow, erasing all of its 208-point early gain. Small caps and I-fund faded as well but led with solid 1.3% gains.
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I'm going to make this quick today because of then holiday atmosphere and I don't know how many people will actually be reading
The market seems on the verge of something and what that something is has been debated ad nauseam. The S&P has held so far at all of the previous lows and could potentially start a rally from here, but if it does breakdown the action would likely be brutal. It's a very close call. Here are a couple of example of what I'm talking about.
In 2015 and 2016 we saw dramatic sell-offs, both of which rebounded, came back to test the lows, then rallied strongly.
In 2011 we saw a similar successful test of the lows in June and one that failed in August that led to a melt-down of another 10% below that June lows. In August we saw one of those "h" formations start to form and it lasted for about 2 months, culminating with one "wooosh" low in early October that eventually became the lows. That's what many have been looking for this time to call this a bottom, but we haven't seen it yet. I'm not so sure we have to get something like that, especially if everyone is looking for it.
So, where we are in those scenarios is the debate and where the economy is depends on who you ask.
Today is a short day of trading with the stock market closing at 1 PM ET.
Next week on the 29th the G-20 meeting starts and that could be a market mover as investors wait for some red meat on tariffs and interest rates.
The S&P 500 / C-fund was up sharply for most of the day on Wednesday as the overhead gap was drawing some attention, but that all came crashing down in the last hour of trading. The gap is still open, the trend is down, but the October lows may end up holding and providing support. That's a lot to speculate about. Friday's light volume, short day of trading may or may not tell us much, unfortunately.
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 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.
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I'm going to make this quick today because of then holiday atmosphere and I don't know how many people will actually be reading
The market seems on the verge of something and what that something is has been debated ad nauseam. The S&P has held so far at all of the previous lows and could potentially start a rally from here, but if it does breakdown the action would likely be brutal. It's a very close call. Here are a couple of example of what I'm talking about.
In 2015 and 2016 we saw dramatic sell-offs, both of which rebounded, came back to test the lows, then rallied strongly.
In 2011 we saw a similar successful test of the lows in June and one that failed in August that led to a melt-down of another 10% below that June lows. In August we saw one of those "h" formations start to form and it lasted for about 2 months, culminating with one "wooosh" low in early October that eventually became the lows. That's what many have been looking for this time to call this a bottom, but we haven't seen it yet. I'm not so sure we have to get something like that, especially if everyone is looking for it.
So, where we are in those scenarios is the debate and where the economy is depends on who you ask.
Today is a short day of trading with the stock market closing at 1 PM ET.
Next week on the 29th the G-20 meeting starts and that could be a market mover as investors wait for some red meat on tariffs and interest rates.
The S&P 500 / C-fund was up sharply for most of the day on Wednesday as the overhead gap was drawing some attention, but that all came crashing down in the last hour of trading. The gap is still open, the trend is down, but the October lows may end up holding and providing support. That's a lot to speculate about. Friday's light volume, short day of trading may or may not tell us much, unfortunately.
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 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.
