Another typical holiday trading day on Monday and the gains were even bigger than the already strong seasonal averages. The Dow gained 73-points as the bears stayed home and the bulls remain in control.
[TABLE="width: 80%, align: center"]
[TR]
[TD="width: 300"]
[TD="align: center"] Daily TSP Funds Return[TABLE="width: 185"]
[TR]
[TD="width: 83, align: right"] G-Fund:[/TD]
[TD="align: right"] +0.0189%[/TD]
[/TR]
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[TD="width: 83, align: right"] F-fund:[/TD]
[TD="align: right"] -0.10%[/TD]
[/TR]
[TR]
[TD="width: 83, align: right"] C-fund:[/TD]
[TD="align: right"] +0.55%[/TD]
[/TR]
[TR]
[TD="width: 83, align: right"] S-fund:[/TD]
[TD="align: right"] +0.79%[/TD]
[/TR]
[TR]
[TD="width: 83, align: right"] I-fund:[/TD]
[TD="align: right"] +0.79%[/TD]
[/TR]
[/TABLE]
[TABLE="width: 69%, align: center"]
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[TD="align: right"] [/TD]
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The S&P 500 (SPY) made new highs again, and are now approaching the top of its rising trading channel, but can anything stop it?
Chart provided courtesy of www.decisionpoint.com, analysis by TSP Talk
The small caps also made new highs as the sharp rally off of the Fed's tapering meeting continues.
Chart provided courtesy of www.decisionpoint.com, analysis by TSP Talk
Today (Tuesday) is day -1 on this seasonality chart surrounding Christmas Day.
Chart provided courtesy of www.sentimentrader.com
From sentimenTrader.com: "Over the past 60 years, when the S&P 500 was up 15% or more heading into what has been one of the most positive seasonal stretches of the year (now through the first 2 days in January), it was positive 19 out of 21 years. From the 2nd day of January through the next three weeks, however, it showed a positive return only 8 times with a median return of -1.9%. Regardless of how the year had performed, when the week leading up to the last week of the year was up more than 2%, then the next 7 days were up 7 out of 8 times. So an already-great performance didn't dampen the seasonal positives at all."
So it looks like the odds favor a bullish holiday week in to early January, but then some profit taking, which would make sense. Personally, I am a little concerned with the stock market in 2014, but we'll get more into that after Christmas and New Year's.
The longer-term (left) and shorter-term (right) bond charts below are giving mixed signals and I am wondering if it is holiday trading related. The TLT broke out to the upside of a pennant formation, but that might be a pre-holiday fake-out. The IEF is still trading below the neckline of the head and shoulders breakdown.
Chart provided courtesy of www.decisionpoint.com, analysis by TSP Talk
Tuesday will be a short trading day as the market closes at 1 PM ET.
In today's TSP Talk Plus Report we look at the short and intermediate-term indicators. 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 very Merry Christmas and enjoy your holiday time off.
Tom Crowley
Posted daily at TSP Talk Market Commentary
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