Stocks were down yesterday as we saw the first two-day losing streak for the Dow and S&P in over three weeks. The losses were modest but we are seeing some minor cracks in the technical picture. The Dow lost 73-points on the day.
[TABLE="width: 80%, align: center"]
[TR]
[TD="width: 300"]
[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"] -0.01%[/TD]
[/TR]
[TR]
[TD="align: right"] C-fund:[/TD]
[TD="align: right"] -0.38%[/TD]
[/TR]
[TR]
[TD="align: right"] S-fund:[/TD]
[TD="align: right"] -0.26%[/TD]
[/TR]
[TR]
[TD="align: right"] I-fund:[/TD]
[TD="align: right"] -0.80%[/TD]
[/TR]
[/TABLE]
[TABLE="width: 69%, align: center"]
[TR]
[TD="align: right"] [/TD]
[/TR]
[/TABLE]
[/TD]
[/TR]
[/TABLE]
The I-fund was the laggard as the dollar put in another strong day as it continues to rally off of the long-term support line.
Here are the final October returns and the current annual for the TSP funds:
The S&P 500 (SPY) broke below its widest rising trading channel - using the October low, but the old resistance line held as support.
Chart provided courtesy of www.decisionpoint.com, analysis by TSP Talk
The weekly chart shows just how extended the S&P is and it seems like the path of least resistance is down, but we're heading into the strongest seasonal time of the year and we'll have to see if the bears have the guts to push the downside after being beaten up all year trying to do so.
Chart provided courtesy of www.decisionpoint.com, analysis by TSP Talk
The small caps of the Russell 2000 also look to be rolling over near their longer-term resistance line and the PMO indicator is getting close to a sell signal. The trend is still up and only short-term market timers may be interested in dodging any pullback. The buy and hold and longer-term investors will look at this as just a little bump in the road. We probably won't get their attention until this rising channel breaks down.
Chart provided courtesy of www.decisionpoint.com, analysis by TSP Talk
Bonds have been rallying for several weeks now after being in a bear market for over a year. The 30-year Treasury is trying to move back above its 200-week moving average again and the weekly PMO has moved to a buy signal. You can see that it has been able to rebound from the 200-week MA going back to late 2008, and actually a lot longer than that.
Chart provided courtesy of www.decisionpoint.com, analysis by TSP Talk
So this is a very important juncture for the bond market. Will it rebound like it has done for years after testing the 200-week moving average, or are bonds about to break their uptrend that has lasted for many years? How many years?
Take a look at this monthly chart that goes back to the early 1980's. Bond yields have been steadily falling for many years and bond prices have been rising. How long can that last? Obviously at least 33 years.
Chart provided courtesy of www.decisionpoint.com, analysis by TSP Talk
As earnings season winds down and the Fed is out of the way, so what will be the catalyst for the stock market going forward? Perhaps a little breather sounds about right.
In today's TSP Talk Plus report we go over the action in dollar, plus the Sentiment Survey results and the Dumb Money Confidence indicator. 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.
