The Dow and S&P 500 fell for a 5th straight day yesterday as the country moved closer to the end of the fiscal year without a continuing resolution that would keep the government fully funded. It hasn't been a complete sell-off, but there's some obvious jitters which may keep the usual dip buyers at bay until next week when we could have a budget.
[TABLE="width: 80%, align: center"]
[TR]
[TD="width: 310"]
[TD="align: center"] Daily TSP Funds Return[TABLE="width: 158"]
[TR]
[TD="align: right"] G-Fund:[/TD]
[TD="align: right"] +0.0063%[/TD]
[/TR]
[TR]
[TD="align: right"] F-fund:[/TD]
[TD="align: right"] +0.17%[/TD]
[/TR]
[TR]
[TD="align: right"] C-fund:[/TD]
[TD="align: right"] -0.27%[/TD]
[/TR]
[TR]
[TD="align: right"] S-fund:[/TD]
[TD="align: right"] +0.08%[/TD]
[/TR]
[TR]
[TD="align: right"] I-fund:[/TD]
[TD="align: right"] +0.05%[/TD]
[/TR]
[/TABLE]
[TABLE="width: 69%, align: center"]
[TR]
[TD="align: right"] [/TD]
[/TR]
[/TABLE]
[/TD]
[/TR]
[/TABLE]
Once again small caps outperformed, the I-fund was up with the dollar down again, and bonds (F-fund) went up as yields moved down.
The S&P 500 (SPY) was down, but again the losses were modest. The higher gap on the SPY was penetrated yesterday, while the short-term rising support line and the 20-day EMA are just below for some possible support.
Chart provided courtesy of www.decisionpoint.com, analysis by TSP Talk
The small caps of the Russell 2000 continues its relative strength, is above the August high, and is still flirting with new highs.
Chart provided courtesy of www.decisionpoint.com, analysis by TSP Talk
Our S-fund is not just small caps, however. The S-fund is really the Wilshire 4500, which is the total U.S. market minus the S&P 500. So the rest of the S-fund is mid-caps and mid-caps are not above the August high and there is actually a bear flag on this MDY mid-cap ETF.
Chart provided courtesy of www.decisionpoint.com, analysis by TSP Talk
So, the larger the stocks, the worse they have been doing lately, and our S-fund is being affected by both the Russell 2000 and the mid-cap stocks so we should watch both since they are not doing the same thing right now.
Bond yields dipped again and the 10-year yield has now nearly filled the large open gap from mid-August. This may continue lower until we get some kind of resolution in Washington.
Chart provided courtesy of www.decisionpoint.com, analysis by TSP Talk
The 7-10 year bonds moved up yet again and momentum is back in the bonds' court. The short-term trend is clearly now up.
Chart provided courtesy of www.decisionpoint.com, analysis by TSP Talk
Come next Monday at midnight the government could be without a budget and while it won't mean the end of the world, it will have an impact us and since we are here to talk about the TSP, it could have a big impact of stocks and bonds and that means your TSP account - unless you are in the G-fund (I'm actually not sure what it means for the G-fund.) Nothing will likely be done until the weekend or even last minute on Monday. The market seems to like to do what you least expect, but I don't think too many investors will be confidently buying leading up to this weekend.
In today's TSP Talk Plus report we'll look at some short and intermediate-term indicators, plus the recent action in the dollar. 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! We'll see you tomorrow.
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.
