The post-election reaction was mostly positive, but stocks were mixed yesterday with the Dow (+101) and the S&P 500 picking up a solid 0.6%. But small caps were up just slightly, and the Nasdaq closed in negative territory.
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The I-fund added 0.34% and the F-fund (bonds) were down slightly.
The SPY (S&P 500 / C-fund) kept its relentless rising trading channel alive and it made a new closing high on Wednesday. That neckline (blue) of the inverted head and shoulders pattern we've been watching is the area we think there could become resistance.
Chart provided courtesy of www.stockcharts.com, analysis by TSP Talk
The Wilshire 4500 (S-fund) was up slightly after Tuesday's selling, and it is still down for the week. The 20-day EMA just crossed back above the 50-day EMA, and that can be a sign of temporary fatigue and a little pause would be healthy.
Chart provided courtesy of www.stockcharts.com, analysis by TSP Talk
The Russell 2000 remains in a sharp ascending trend and it successfully tested the support line for a second straight day. The support line is rising so quickly that the RUT really needs to move up almost every day to sustain it, which obviously isn't possible.
Chart provided courtesy of www.stockcharts.comm, analysis by TSP Talk
The Nasdaq 100 (QQQ) was actually down slightly yesterday, lagging the rest of the market, and after Qualcomm reported disappointing earnings after the close yesterday, there may be more pressure on the Nasdaq today.
Chart provided courtesy of www.stockcharts.com, analysis by TSP Talk
The Dow Transportation Index had a nice day but it is dealing with its own resistance near Tuesday' high. This also looks like a large inverted head and shoulders pattern forming, so there is some risk of a pullback if that resistance doesn't get broken soon.
Chart provided courtesy of www.stockcharts.com, analysis by TSP Talk
The EFA (EAFE Index / I-fund) was up yesterday but continues to trade below some key resistance.
Chart provided courtesy of www.sentimentrader.com, analysis by TSP Talk
The German DAX pulled back yesterday and filled its open gap. That's a good thing, but it has to get back above the 50-day EMA or the bears may start to push pressure on it again.
Chart provided courtesy of www.stockcharts.com, analysis by TSP Talk
The AGG (bonds/ (F-fund) remains in a downtrend but continues to hang above the August highs.
Chart provided courtesy of www.stockcharts.com, analysis by TSP Talk
Bonds spiked late yesterday while stocks were also rising, which I thought was interesting. I'm not sure what to make of it but we'll see if that trend continues today.
The October jobs report comes out on Friday and consensus estimates are looking for a gain of about 235,000 jobs and an unemployment rate of 5.9%. The jobs report contest has been started in the Forum.
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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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