Stocks were mixed on Tuesday but a positive reversal made the day a success despite some losses. The Dow was down 64-points on the day, while the Nasdaq gained 64-points. The S&P 500 was up modestly, while the Transports were down Small caps had a good day but the I-fund took a hit. Regardless of the ups and downs, the close was strong heading into Apple's earnings report after the bell.
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And after the bell, Apple posted "decent" earnings. Normally a stock that has high expectations, this quarter Apple had seen declining expectations and they ended up beating the estimates slightly. There were some good numbers but the rally after the bell seemed a little overdone, and it actually started to fade a bit as the after hours trading wore on.
The strength of the dollar has been an issue and yesterday's 0.66% rally pushed it even further above the 200-day EMA making it 4 straight closes above the moving average, and it closed at its highest level of the year. You can see all of the open gaps on the chart but that's more typical on this chart since the UUP trades only during stock market hours while the dollar itself trades basically 24/7.
The 10-year Treasury yield moved higher after finding support at the old resistance line. This goes hand in hand with the strength in the dollar and investors are somewhat concerned. We know the I-fund is impacted significantly by movement in the dollar, but U.S. stocks also feel a bit of a headwind when the dollar is moving higher.
The April Jobs Report comes out on Friday and estimates are looking for a gain of 190,000 jobs and an unemployment rate of 4.0%. The two-day FOMC meeting concludes today but there will be no press conference, nor is there an expected rate hike, but certainly possible clues to future action would impact the market.
The S&P 500 / C-fund posted a nice positive reversal day closing near the highs of the day after being down almost 1% in early trading. It remains in a down trend and in that large bear flag we've been watching, and it is still below the 50-day EMA. So while the short-term action was encouraging, the chart still has some issues.
The small caps / S-fund had a big positive reversal day as well, but like the S&P 500 it's in a downtrend and below the 50-day EMA, and actually that small bear flag in red broke down on Monday, and it's still below that flag. Look for that 1350 level to be a key area that it would need to be taken out on the upside to keep this bounce going.
The Dow Transportation Index was down on the day despite a positive reversal. 10,300 has now held three times in the last 6 days, with a couple of hundred point rally after each test of that area.
The EAFE / I-fund was down on the day and it's just too tough for the I-fund to move higher when the dollar is as strong as it was yesterday.
The AGG (Bonds / F-fund) pulled back slightly as yields moved higher and this chart continues to flirt with the lows.
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. We'll see you back here tomorrow.
Tom Crowley
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.
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And after the bell, Apple posted "decent" earnings. Normally a stock that has high expectations, this quarter Apple had seen declining expectations and they ended up beating the estimates slightly. There were some good numbers but the rally after the bell seemed a little overdone, and it actually started to fade a bit as the after hours trading wore on.
The strength of the dollar has been an issue and yesterday's 0.66% rally pushed it even further above the 200-day EMA making it 4 straight closes above the moving average, and it closed at its highest level of the year. You can see all of the open gaps on the chart but that's more typical on this chart since the UUP trades only during stock market hours while the dollar itself trades basically 24/7.
The 10-year Treasury yield moved higher after finding support at the old resistance line. This goes hand in hand with the strength in the dollar and investors are somewhat concerned. We know the I-fund is impacted significantly by movement in the dollar, but U.S. stocks also feel a bit of a headwind when the dollar is moving higher.
The April Jobs Report comes out on Friday and estimates are looking for a gain of 190,000 jobs and an unemployment rate of 4.0%. The two-day FOMC meeting concludes today but there will be no press conference, nor is there an expected rate hike, but certainly possible clues to future action would impact the market.
The S&P 500 / C-fund posted a nice positive reversal day closing near the highs of the day after being down almost 1% in early trading. It remains in a down trend and in that large bear flag we've been watching, and it is still below the 50-day EMA. So while the short-term action was encouraging, the chart still has some issues.
The small caps / S-fund had a big positive reversal day as well, but like the S&P 500 it's in a downtrend and below the 50-day EMA, and actually that small bear flag in red broke down on Monday, and it's still below that flag. Look for that 1350 level to be a key area that it would need to be taken out on the upside to keep this bounce going.
The Dow Transportation Index was down on the day despite a positive reversal. 10,300 has now held three times in the last 6 days, with a couple of hundred point rally after each test of that area.
The EAFE / I-fund was down on the day and it's just too tough for the I-fund to move higher when the dollar is as strong as it was yesterday.
The AGG (Bonds / F-fund) pulled back slightly as yields moved higher and this chart continues to flirt with the lows.
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. We'll see you back here tomorrow.
Tom Crowley
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.
