Another relatively flat day on Wednesday with a narrow trading range and very light volume. The Dow ended the day with a 15-point gain, the S&P 500 and Nasdaq were flat, and small caps saw a small loss.
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Bonds had a nice day and the I-fund held onto a small gain, leading the TSP stock funds.
The SPY (S&P 500 / C-fund) is still rising in the short-term trading channel (blue) but somewhat stalling here at the red resistance line. There's no doubt that stocks could use a rest, but can the S&P 500 consolidate sideways near 2000 (200 for SPY) to accomplish that, or will we see a pullback of some sort? Volume has been light and unless something out of the ordinary happens, the next two days may even be lighter.
Chart provided courtesy of www.stockcharts.com, analysis by TSP Talk
The Dow hasn't been able to break above its double top, and often double tops trigger a pullback. That didn't happen in the S&P 500 or the Nasdaq so can the Dow breakout before pulling back? We saw a pullback of about 900-points rather quickly, but almost as quickly, it has regained those losses. You would think it needs a rest, and anyone who was a buyer when the Dow peaked in mid-July, may be satisfied enough just to get even again.
Chart provided courtesy of www.stockcharts.com, analysis by TSP Talk
The Wilshire 4500 (S-fund) was down slightly and remains in a solid uptrend. Extended? Yes. But like the Dow and other indices, there may be a push to at least test the old highs.
Chart provided courtesy of www.stockcharts.com, analysis by TSP Talk
The EFA (I-fund) was up slightly Wednesday but for a 3rd straight day it closed well off the highs. It is inching into that open gap (blue) and actually broke above some descending resistance. It also closed above the 50-day EMA for the first time in over 4 weeks.
Chart provided courtesy of www.stockcharts.com, analysis by TSP Talk
The German DAX tried to climb above the 50-day EMA but fell back below it before Wednesday's close. I am a little surprised by the size of the rebounds in the European markets since these charts had bear market written all over them, but like the U.S. Fed, the ECB is throwing money at the financial problems over there and that seems to be all that matters. The heck with the recession in France.
Chart provided courtesy of www.stockcharts.com, analysis by TSP Talk
The chart of the IEF (Bonds / F-fund) continues to look bullish after breaking out, holding the old resistance line on a pullback, and has continued a series of higher highs and higher lows.
Chart provided courtesy of www.stockcharts.com, analysis by TSP Talk
Per www.tsp.gov: Some financial markets will be closed on Monday, September 1st in observance of the Labor Day holiday. The Thrift Savings Plan will also be closed. Transactions that would have been processed Monday night (September 1st) will be processed Tuesday night (September 2nd), at Tuesday's closing share prices.
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Thanks for reading! We'll see you back here tomorrow.
Tom Crowley
Posted daily at TSP Talk Market Commentary
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