Stocks slipped on Thursday, taking a much needed break after rallying 7 of the prior 8 days. The ECB, the European Central Bank, left rates unchanged, as expected, and didn’t offer any new stimulus so stocks had a bit of a mini tantrum. ECB head Mario Draghi did leave open the possibility of future action. The Dow lost 114-points and we saw losses of about 0.5% or more in some major indices.
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After the bell there was another round of disappointing earnings released from some of the major companies. Microsoft, Alphabet (aka Google), Starbucks, and Visa were all down sharply after hours and that could set the tone for Friday's market action.
The S&P 500 (C-Fund) hit some resistance at the late 2015 highs and pulled back modestly yesterday. A negative reversal day on Wednesday followed by some weakness on Thursday is nothing to be alarmed about for the bulls, but the index has run quite a bit in the last couple of months and may need to stop and refresh for at least a few days. The fact that a lot of investors have missed this rally makes it less likely that any pullback will be significant. A gift for those looking to buy would be a pullback to the 50 or even the 200-day EMAs, but that may be too much to ask for since dip buyers have been lurking closely.
The DWCPF (small caps / S-fund) lost 0.5% but is still near the top of its recent rising trading channel. A move to the lower end would be very possible and that would give it the convenience of retesting the 200-day EMA. But the bulls are clearly in charge and the dips may be shallow making it tough for the buyer to get a decent price.
The Dow Transportation Index lost 1.2% on Thursday after testing and failing at the March high earlier this week. There is still quite a bit of support from here down to the 50-day EMA. Support gets very weak after that so the bulls need to have it hold the 7700 area if 8000 fails.
The EFA (EAFE Index / I-fund) hit the top of it rising channel and started to dip. There are still three large open gaps on this chart that may need some attention.
The AGG (Bonds / F-fund) failed on Wednesday to breakout above the 111.0 area and on Thursday the selling continued. If it failed to rebound here the 110 should provide decent support.
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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After the bell there was another round of disappointing earnings released from some of the major companies. Microsoft, Alphabet (aka Google), Starbucks, and Visa were all down sharply after hours and that could set the tone for Friday's market action.
The S&P 500 (C-Fund) hit some resistance at the late 2015 highs and pulled back modestly yesterday. A negative reversal day on Wednesday followed by some weakness on Thursday is nothing to be alarmed about for the bulls, but the index has run quite a bit in the last couple of months and may need to stop and refresh for at least a few days. The fact that a lot of investors have missed this rally makes it less likely that any pullback will be significant. A gift for those looking to buy would be a pullback to the 50 or even the 200-day EMAs, but that may be too much to ask for since dip buyers have been lurking closely.
The DWCPF (small caps / S-fund) lost 0.5% but is still near the top of its recent rising trading channel. A move to the lower end would be very possible and that would give it the convenience of retesting the 200-day EMA. But the bulls are clearly in charge and the dips may be shallow making it tough for the buyer to get a decent price.
The Dow Transportation Index lost 1.2% on Thursday after testing and failing at the March high earlier this week. There is still quite a bit of support from here down to the 50-day EMA. Support gets very weak after that so the bulls need to have it hold the 7700 area if 8000 fails.
The EFA (EAFE Index / I-fund) hit the top of it rising channel and started to dip. There are still three large open gaps on this chart that may need some attention.
The AGG (Bonds / F-fund) failed on Wednesday to breakout above the 111.0 area and on Thursday the selling continued. If it failed to rebound here the 110 should provide decent support.
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.
