04/21/26
Stocks opened lower on Monday but they showed some resilience despite the short-term overly stretched indices, telling us that the dip buyers are still lurking, and willing and able to buy. The indices were mixed with small caps doing very well on the day while big tech slowed down the large cap indices.
Let's go to the current catalyst - the price of oil - which was up 6% yesterday after the back and forth Strait of Hormuz headlines. It jumped back above the 50-day moving average, but I still see this trying to create a bearish head and shoulders pattern, which would mean an eventual breakdown, but some potential near-term upside if it fills in the right shoulder.
The S&P 500 (C-fund) paused for a day but clearly the bears have not been able to do much damage, but rather they have been trying to figure out how to get in the market without buying near the highs. The shallow dips, as rare as they have been over the last few weeks, have been getting bought quickly. We have to keep mentioning the open gaps because they do tend to get filled, however...
... we only have to go back to the similar drop and pop last April to see that gaps don't always get filled. None of those gaps off the 2025 lows shown have been filled yet. Even the recent correction in March of this year only went as low as 6300, so it did not fill in any of those gaps. So, what tends to happen, doesn't always happen, but just as soon as we think they won't get filled again, the market may try to pull a fast one on us and start filling these.
The 10-year Treasury Yield was up slightly as support continues to hold, leaving the bull flag intact.
The CNN Fear & Greed Index has now gone from a single digit Extreme Fear reading at the March market lows, up into the Greed zone of 70 and inching closer to the Extreme Greed zone. All in three weeks.
Source: https://www.cnn.com/markets/fear-and-greed
One other thing that I haven't talked about in a while is the growing Fed Balance Sheet. Last year the stock market did just fine with the balance sheet shrinking, but now it is growing, and that is yet another breeze at the back of this bull market.
Additional TSP Fund Charts:
DWCPF (S-fund) led the way on Monday to another new closing high, leaving those open gaps in its wake as the ship sets sail.
The weekly chart does show some potential resistance in the area, so if that is going to hold, the upside would be stopping right about here, but do the bears have the fortitude to make a move now?
ACWX (I-fund) pulled back moderately on Monday and it did fill in one of the gaps. There is still room above the rising support line to fill in the 2nd gap if we get a 2nd down day today. That would be a nice, clean place for this chart to resume its upside. However, a move down to the 20-day moving average may be a more cleansing move to build a better base before it resumes higher. However, the impatient dip buyers may keep it from getting there.
BND (bonds / F-fund) pulled back early and filled in a portion of Friday gap before rebounding again and closing close to flat on the day - all above the support from the rising trading channel.
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
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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 use additional methods and strategies to determine fund positions.
Stocks opened lower on Monday but they showed some resilience despite the short-term overly stretched indices, telling us that the dip buyers are still lurking, and willing and able to buy. The indices were mixed with small caps doing very well on the day while big tech slowed down the large cap indices.
| Daily TSP Funds Return More returns |
Let's go to the current catalyst - the price of oil - which was up 6% yesterday after the back and forth Strait of Hormuz headlines. It jumped back above the 50-day moving average, but I still see this trying to create a bearish head and shoulders pattern, which would mean an eventual breakdown, but some potential near-term upside if it fills in the right shoulder.
The S&P 500 (C-fund) paused for a day but clearly the bears have not been able to do much damage, but rather they have been trying to figure out how to get in the market without buying near the highs. The shallow dips, as rare as they have been over the last few weeks, have been getting bought quickly. We have to keep mentioning the open gaps because they do tend to get filled, however...
... we only have to go back to the similar drop and pop last April to see that gaps don't always get filled. None of those gaps off the 2025 lows shown have been filled yet. Even the recent correction in March of this year only went as low as 6300, so it did not fill in any of those gaps. So, what tends to happen, doesn't always happen, but just as soon as we think they won't get filled again, the market may try to pull a fast one on us and start filling these.
The 10-year Treasury Yield was up slightly as support continues to hold, leaving the bull flag intact.
The CNN Fear & Greed Index has now gone from a single digit Extreme Fear reading at the March market lows, up into the Greed zone of 70 and inching closer to the Extreme Greed zone. All in three weeks.
Source: https://www.cnn.com/markets/fear-and-greed
One other thing that I haven't talked about in a while is the growing Fed Balance Sheet. Last year the stock market did just fine with the balance sheet shrinking, but now it is growing, and that is yet another breeze at the back of this bull market.
Additional TSP Fund Charts:
DWCPF (S-fund) led the way on Monday to another new closing high, leaving those open gaps in its wake as the ship sets sail.
The weekly chart does show some potential resistance in the area, so if that is going to hold, the upside would be stopping right about here, but do the bears have the fortitude to make a move now?
ACWX (I-fund) pulled back moderately on Monday and it did fill in one of the gaps. There is still room above the rising support line to fill in the 2nd gap if we get a 2nd down day today. That would be a nice, clean place for this chart to resume its upside. However, a move down to the 20-day moving average may be a more cleansing move to build a better base before it resumes higher. However, the impatient dip buyers may keep it from getting there.
BND (bonds / F-fund) pulled back early and filled in a portion of Friday gap before rebounding again and closing close to flat on the day - all above the support from the rising trading channel.
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
Updated monthly:
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 use additional methods and strategies to determine fund positions.
