​ Stocks were down again on Thursday as the Dow shed 121-points. That was 55-points off the day's low, but the bulls didn't put up much of a fight. The media stocks in the Dow were to blame for much of the 121-points, but it was the Nasdaq that was the worst hit, despite Apple closing higher. This morning (Friday) we get the July jobs report and that could either solidify the recent weakness, or help stocks reverse course. Estimates are looking for a gain of 220,000 jobs, and an unemployment rate of 5.3%. The Jobs Report Contest winner will be announced here.
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The I-fund dodged a bullet while the small caps took the brunt of the selling. Bonds were up as a safe haven play.
The SPY (S&P 500 / C-fund) lost 0.82% on Thursday and as we have been talking about, could be reaching for the 206-207 area to complete a mirror image of the left shoulder of what looks like an inverted head and shoulders pattern. An exact copy of the left shoulder isn't likely, but the right shoulder seems to be doing something very similar.
Chart provided courtesy of www.stockcharts.com, analysis by TSP Talk
The Dow Completion Index (S-fund) has been in a downtrend and failed on its last attempt to get above the 50-day EMA and falling resistance. The negative reversal day on Wednesday produced some downside follow-through on Thursday, but on Thursday we saw a bit of a positive reversal day so perhaps we'll see some upside action on Friday. Of course the jobs report may have a say in that.
Chart provided courtesy of www.stockcharts.com, analysis by TSP Talk
The Dow Transportation Index did break below the "F" flag that we've been watching, just like it did in July. The difference this time is that there is the 50-day EMA to try to support it, but the failure at the 200-day EMA was not encouraging. This index is still in a bear market.
Chart provided courtesy of www.stockcharts.com, analysis by TSP Talk
The EFA (EAFE index / I-fund) was down 0.42% and continues to flirt with the support and resistance of the pennant's apex. It has actually closed above the 50-day EMA for three straight days but it is so close that it's hardly something to get excited about yet.
Chart provided courtesy of www.stockcharts.com, analysis by TSP Talk
China's Shanghai has done a nice job of holding above the early July lows but the two bear flags are not easy to ignore. This chart still looks very shaky and this is important because the losses in China seem to be having an impact on sales of companies from around the world including Apple, GM, and other car companies like BMW and Audi - to name a few.
Chart provided courtesy of www.stockcharts.com, analysis by TSP Talk
The AGG (bonds / F-fund) was up slightly as a safe haven play. It is still flirting with levels of old resistance and support.
Chart provided courtesy of www.stockcharts.com, analysis by TSP Talk
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Thanks for reading! Have a great weekend!
Tom Crowley
Posted daily at www.tsptalk.com/comments.php
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