The bears had an opportunity to put a stop to the relief rally, but the dip buyers showed up for each intraday pullback attempt. Small caps lagged, but the S-fund only gave back a fraction of Monday's nearly 3% gain. Yields opened higher but closed near the lows of the day after another weaker than expected consumer confidence report.
That's a lot of green above but internally it was a little softer as small and mid-cap stocks lagged, and tech also pulled back once you got past the Magnificent 7 stocks.
For now, it's still looking OK but the bulls must keep the pressure on and make the underinvested feel the FOMO, otherwise the bears will bite back and try to test those prior lows at a minimum. The fact that the S&P 500 closed above the morning lows and rallied into the close, is a good sign. Theoretically the late money is the smarter money and it could also be money managers doing some window dressing for their quarterly reports.
With three trading days left in the first quarter of 2025, there is some favorable seasonality, although March 31 has been a little weaker over the last 30 years. We do see that odd very negative day on the 27th for some reason, so we'll have to see what that means for Thursday. It could just be that the 26th has been so strong that it forced some profit taking on the 27th.
Chart provided courtesy of www.sentimentrader.com
The S&P 500 (C-fund) was up despite plenty of reasons technically, and psychologically, for the chart to stall near Monday's highs, but it was able to make a small gain on Tuesday to nudge above another modest layer of resistance. The 50 and 100-day averages area still nearly 100 points above yesterday's closing price.
The PMO momentum indicator is crossing back above its moving average. That's a favorable sign for the intermediate-term, but possibly a very short-term sign of being overbought. If the open gap down near 5660 is going to attempt to get filled, it may be now. Otherwise, the bulls are likely to try to push the S&P up to those next levels of resistance near 5850.
The 10-year Treasury Yield (moves counter to the F-fund) tested the 50-day EMA and the top of that bear flag, as well as an open gap near 4.4%, before it rolled over again and then tested the 200-day average as support. Bear flags tend to break down, but what will be the reason for yields to break down? Maybe Friday's inflation report (PCE Prices?)
Consumer Confidence was very low, the lowest in 12 years and the 4th consecutive monthly decline, but that's potentially low enough to use as a contrarian indicator. In general, consumer confidence and sentiment is not hitting lows at stock market highs. It is lowest near market bottoms.
Again the Tariff start date is April 2nd and everyone knows it yet stocks are holding up well for now. But first things first. The market must get by Friday's PCE Prices and Personal Income reports.
The DWCPF (S-fund) pulled back modestly yesterday, but that was following the nearly 3% gain it had on Monday, so it looks normal. The possibility of a gap fill just above 2100 still exists, but now that the index is back above it, that red 300-day moving average may try to hold as support.
The ACWX (I-fund) was up again and after Monday's lagging performance, it was the leader yesterday. The chart is attempting to make another higher low, which could mean another test of the double top, which is just above that 57 area.
BND (F-fund) bounced back as yields slipped on the weaker consumer confidence number. It remains in a bull flag (blue) which is inside a rising trading channel. It looks bullish although there could be more short-term choppiness inside those formations.
Thanks so much for reading! We'll see you back here tomorrow.
Tom Crowley
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
Questions, comments, or issues with today's commentary? We can discuss it in the Forum.
Daily Market Commentary Archives
For more info our other premium services, please go here... www.tsptalk.com/premiums.php
To get weekly or daily notifications when we post new commentary, sign up HERE.
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 may use additional methods and strategies to determine fund positions.
| Daily TSP Funds Return More returns |
That's a lot of green above but internally it was a little softer as small and mid-cap stocks lagged, and tech also pulled back once you got past the Magnificent 7 stocks.
For now, it's still looking OK but the bulls must keep the pressure on and make the underinvested feel the FOMO, otherwise the bears will bite back and try to test those prior lows at a minimum. The fact that the S&P 500 closed above the morning lows and rallied into the close, is a good sign. Theoretically the late money is the smarter money and it could also be money managers doing some window dressing for their quarterly reports.
With three trading days left in the first quarter of 2025, there is some favorable seasonality, although March 31 has been a little weaker over the last 30 years. We do see that odd very negative day on the 27th for some reason, so we'll have to see what that means for Thursday. It could just be that the 26th has been so strong that it forced some profit taking on the 27th.
Chart provided courtesy of www.sentimentrader.com
The S&P 500 (C-fund) was up despite plenty of reasons technically, and psychologically, for the chart to stall near Monday's highs, but it was able to make a small gain on Tuesday to nudge above another modest layer of resistance. The 50 and 100-day averages area still nearly 100 points above yesterday's closing price.
The PMO momentum indicator is crossing back above its moving average. That's a favorable sign for the intermediate-term, but possibly a very short-term sign of being overbought. If the open gap down near 5660 is going to attempt to get filled, it may be now. Otherwise, the bulls are likely to try to push the S&P up to those next levels of resistance near 5850.
The 10-year Treasury Yield (moves counter to the F-fund) tested the 50-day EMA and the top of that bear flag, as well as an open gap near 4.4%, before it rolled over again and then tested the 200-day average as support. Bear flags tend to break down, but what will be the reason for yields to break down? Maybe Friday's inflation report (PCE Prices?)
Consumer Confidence was very low, the lowest in 12 years and the 4th consecutive monthly decline, but that's potentially low enough to use as a contrarian indicator. In general, consumer confidence and sentiment is not hitting lows at stock market highs. It is lowest near market bottoms.
Again the Tariff start date is April 2nd and everyone knows it yet stocks are holding up well for now. But first things first. The market must get by Friday's PCE Prices and Personal Income reports.
The DWCPF (S-fund) pulled back modestly yesterday, but that was following the nearly 3% gain it had on Monday, so it looks normal. The possibility of a gap fill just above 2100 still exists, but now that the index is back above it, that red 300-day moving average may try to hold as support.
The ACWX (I-fund) was up again and after Monday's lagging performance, it was the leader yesterday. The chart is attempting to make another higher low, which could mean another test of the double top, which is just above that 57 area.
BND (F-fund) bounced back as yields slipped on the weaker consumer confidence number. It remains in a bull flag (blue) which is inside a rising trading channel. It looks bullish although there could be more short-term choppiness inside those formations.
Thanks so much for reading! We'll see you back here tomorrow.
Tom Crowley
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
Questions, comments, or issues with today's commentary? We can discuss it in the Forum.
Daily Market Commentary Archives
For more info our other premium services, please go here... www.tsptalk.com/premiums.php
To get weekly or daily notifications when we post new commentary, sign up HERE.
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 may use additional methods and strategies to determine fund positions.
