1/29/13
Stocks were flat to slightly lower yesterday as the Dow lost 14-points, the S&P shed 3, and small caps ticked up 0.01%.
[TABLE="width: 88%, align: center"]
[TR]
[TD]
[/TD]
[TD="align: center"]Daily TSP Funds Return[TABLE="width: 153"]
[TR]
[TD]G-Fund:[/TD]
[TD="align: right"]0.0121%[/TD]
[/TR]
[TR]
[TD]F-fund:[/TD]
[TD="align: right"]-0.06%[/TD]
[/TR]
[TR]
[TD]C-fund:[/TD]
[TD="align: right"]-0.18%[/TD]
[/TR]
[TR]
[TD]S-fund:[/TD]
[TD="align: right"]0.01%[/TD]
[/TR]
[TR]
[TD]I-fund:[/TD]
[TD="align: right"]-0.18%[/TD]
[/TR]
[/TABLE]
[TABLE="width: 80%, align: center"]
[TR]
[TD="align: right"]More returns [/TD]
[/TR]
[/TABLE]
[/TD]
[/TR]
[/TABLE]
The S&P 500 was down 0.02% yesterday but remained above the psychological 1500 level. A 0.02% loss was all the bears could do after 8 consecutive positive days. Quite bullish, but looking at the chart there are some obvious obstacles ahead.
Chart provided courtesy of www.decisionpoint.com, analysis by TSP Talk
The longer-term rising trading channel is close at hand, but I see that the S&P is trading 100-points above the 200-day EMA. If that spread becomes closer to 125 I may have to force myself to step aside. That seems to be a magic number (whether it's 125 points or a percentage I haven't determined) to be overly stretched, and we've seen that before over the years.
Of course the 200-day EMA is rising so the target is moving, but another 25-points from here not only puts the S&P close to 125-points above the EMA, but it also hits the upper resistance line, and at that point the easy money has probably been made - if that isn't true already. So if we see 1525 this week, I will likely make my way to exit.
Historically February isn't the month that November, December and January are, and tends to be a profit taking month.
Chart provided courtesy of www.sentimentrader.com
The good news is, March and April bounce right back.
Chart provided courtesy of www.sentimentrader.com
Seasonality isn't a primary indicator, but I always take a look before we head into a new month.
As far as sentiment goes, the dumb money has moved over the 60% level in the sentimenTrader.com smart money / dumb money confidence indicator, while the smart money moved below 40%.
Chart provided courtesy of www.sentimentrader.com
This 60 / 40 spread between the two is a warning sign, and if we see 70 / 30 it will be a red flag.
It's still a boring market and it could continue to frustrate the bears by slowly moving higher, but we know eventually we'll get a pullback - but when? This week? next month? Since we don't know, I'm picking the 1525 level for the S&P based on my analysis, and hopefully I'll get the opportunity to sell that high before a pullback.
Thanks for reading! We'll see you back here tomorrow.
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.
Stocks were flat to slightly lower yesterday as the Dow lost 14-points, the S&P shed 3, and small caps ticked up 0.01%.
[TABLE="width: 88%, align: center"]
[TR]
[TD]
[TD="align: center"]Daily TSP Funds Return[TABLE="width: 153"]
[TR]
[TD]G-Fund:[/TD]
[TD="align: right"]0.0121%[/TD]
[/TR]
[TR]
[TD]F-fund:[/TD]
[TD="align: right"]-0.06%[/TD]
[/TR]
[TR]
[TD]C-fund:[/TD]
[TD="align: right"]-0.18%[/TD]
[/TR]
[TR]
[TD]S-fund:[/TD]
[TD="align: right"]0.01%[/TD]
[/TR]
[TR]
[TD]I-fund:[/TD]
[TD="align: right"]-0.18%[/TD]
[/TR]
[/TABLE]
[TABLE="width: 80%, align: center"]
[TR]
[TD="align: right"]More returns [/TD]
[/TR]
[/TABLE]
[/TD]
[/TR]
[/TABLE]
The S&P 500 was down 0.02% yesterday but remained above the psychological 1500 level. A 0.02% loss was all the bears could do after 8 consecutive positive days. Quite bullish, but looking at the chart there are some obvious obstacles ahead.
Chart provided courtesy of www.decisionpoint.com, analysis by TSP Talk
The longer-term rising trading channel is close at hand, but I see that the S&P is trading 100-points above the 200-day EMA. If that spread becomes closer to 125 I may have to force myself to step aside. That seems to be a magic number (whether it's 125 points or a percentage I haven't determined) to be overly stretched, and we've seen that before over the years.
Of course the 200-day EMA is rising so the target is moving, but another 25-points from here not only puts the S&P close to 125-points above the EMA, but it also hits the upper resistance line, and at that point the easy money has probably been made - if that isn't true already. So if we see 1525 this week, I will likely make my way to exit.
Historically February isn't the month that November, December and January are, and tends to be a profit taking month.
Chart provided courtesy of www.sentimentrader.com
The good news is, March and April bounce right back.
Chart provided courtesy of www.sentimentrader.com
Seasonality isn't a primary indicator, but I always take a look before we head into a new month.
As far as sentiment goes, the dumb money has moved over the 60% level in the sentimenTrader.com smart money / dumb money confidence indicator, while the smart money moved below 40%.
Chart provided courtesy of www.sentimentrader.com
This 60 / 40 spread between the two is a warning sign, and if we see 70 / 30 it will be a red flag.
It's still a boring market and it could continue to frustrate the bears by slowly moving higher, but we know eventually we'll get a pullback - but when? This week? next month? Since we don't know, I'm picking the 1525 level for the S&P based on my analysis, and hopefully I'll get the opportunity to sell that high before a pullback.
Thanks for reading! We'll see you back here tomorrow.
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.
