04/30/26
Stocks were mixed on Wednesday but fairly contained after the Fed's decision to keep interest rates unchanged. The biggest take away was that they seem to be happy with the pace of economy and inflation, but three of the Fed governor's dissented from the easing bias for the remainder of the year, meaning they don't think there needs to be anymore cuts this year. That's a change from the last meeting. Oil jumped yesterday.
So, no real surprises from the Fed. One member voted to cut rates and as I mentioned three were more hawkish looking to end cuts for the year. Jerome Powell was bowing out gracefully as this was his final press conference as the Fed chair, but he does plan to remain on the board until he sees an "appropriate" time to leave.
The more hawkish Fed sent the 10-year Treasury Yield rising, with the help of the price of oil spiking again.
The Mag 7 earnings are out on Thursday evening and they are moving quickly and conference calls were still to come, so this may change by Thursday's opening bell, but Google was up after a strong report, but Amazon, Meta and Microsoft were all trading lower to some degree in after hours trading yesterday. After the massive run up off the lows, perhaps we're seeing the "sell the news" reaction after buying the rumor on expectations. Can the market continue to rally if Mag 7 stalls?
This may be a copout, sounding like I am talking out of both sides of my mouth, but while I am not fully bearish on stocks at all for the year, I do see a scenario where we could see more choppy action for a while. Not only because that would be typical of a midterm spring / summer seasonal path, but also because of how quickly stocks have rallied off their lows.
What was the biggest concern with the Iranian war, as far as the stock market was concerned? It was that the price of oil could skyrocket because of the Strait of Hormuz issue and the volatility in the area.
Yesterday the price of oil rallied another $8, jumping out of the head and shoulders pattern I had been selling, and now it looks like it may be looking at that "stealth" open gap up near 112. "Stealth" because it looks filled with the eye, but technically the close on on April 7th was 112, and the high the next day was only 109.19.
With the Fed talking and Mag 7 reporting, did the 8% rally in oil get overlooked?
Now, with a less than enthusiastic reaction to the Mag 7 earnings following a massive rally, what can we expect?
With many investors looking at the 2025 "V" bottom as the road map, and perhaps saying, I'm not going to miss the rally this year... maybe it doesn't work out the same? That may be exactly why the angle of incline is so much sharper this year. More people jumped in out of FOMO (fear of missing out.)
Look at the difference one month out from the lows this year compared to last year. The "fool me once" crowd were not going to be fooled again, but as I keep asking, has this one gone too far, too fast, and with oil up and Mag 7 disappointing to some degree, do we have the formula for some volatility on the downside?
The S&P 500 (C-fund) was basically flat yesterday as we headed into last night's earnings fest. Microsoft is the 3rd heaviest weighted stock in the S&P 500, Amazon is 4th, Alphabet (Google) is # 5 and #6 (common and class C shares) and Meta is #8. No wonder no one wanted to commit yesterday. Today we get Apple's earnings after the closing bell, and they are #2 on that weighted list. #1 Nvidia is not reporting until may 20.
According to sentimentrader.com: "On Monday, the S&P 500 closed at a record high. The next day, at least 1% more stocks hit a 52-week low than a 52-week high. In 70+ years of history, that's happened twice. Tuesday was one. January 3, 2000 was the other."
That's was the start of troubling two to three three years for the stock market.
I'm not super bearish. I actually expect new highs into the end of the year after Election Day, but between now and then, as the midterm election year plays out, I believe there is a good chance for more volatility, which isn't all that bad because it sets up trading opportunities.
Let's see what Apple serves up this afternoon. Amazon just went positive after hours during their earnings conference call.
Additional TSP Fund Charts:
DWCPF (S-fund) broke down technically yesterday. This is not a deal breaker for the rally, but it could still be considered a double top pullback now that the breakout failed - at least for a day or two. We'll see what today brings but those open gaps are still beckoning below.
ACWX (I-fund) was hit hard and lagged the other TSP funds: 1) Because the overseas markets were mostly closed before the Fed press conference, and 2) the dollar and yields rallied on the Fed outlook. The 20-day moving average is getting tested again.
BND (bonds / F-fund) got clobbered on the jump in yields yesterday, and now it is back below the wedge formation. The breakout to the upside earlier this month now looks like it was a fake out. I told you this chart / fund has always been tough to negotiate for me. The gap down by 72.80 could be in play again without a quick bounce back.
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
Updated monthly:
Questions, comments, or issues with today's commentary? We can discuss it in the Forum.
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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 use additional methods and strategies to determine fund positions.
Stocks were mixed on Wednesday but fairly contained after the Fed's decision to keep interest rates unchanged. The biggest take away was that they seem to be happy with the pace of economy and inflation, but three of the Fed governor's dissented from the easing bias for the remainder of the year, meaning they don't think there needs to be anymore cuts this year. That's a change from the last meeting. Oil jumped yesterday.
| Daily TSP Funds Return More returns |
So, no real surprises from the Fed. One member voted to cut rates and as I mentioned three were more hawkish looking to end cuts for the year. Jerome Powell was bowing out gracefully as this was his final press conference as the Fed chair, but he does plan to remain on the board until he sees an "appropriate" time to leave.
The more hawkish Fed sent the 10-year Treasury Yield rising, with the help of the price of oil spiking again.
The Mag 7 earnings are out on Thursday evening and they are moving quickly and conference calls were still to come, so this may change by Thursday's opening bell, but Google was up after a strong report, but Amazon, Meta and Microsoft were all trading lower to some degree in after hours trading yesterday. After the massive run up off the lows, perhaps we're seeing the "sell the news" reaction after buying the rumor on expectations. Can the market continue to rally if Mag 7 stalls?
This may be a copout, sounding like I am talking out of both sides of my mouth, but while I am not fully bearish on stocks at all for the year, I do see a scenario where we could see more choppy action for a while. Not only because that would be typical of a midterm spring / summer seasonal path, but also because of how quickly stocks have rallied off their lows.
What was the biggest concern with the Iranian war, as far as the stock market was concerned? It was that the price of oil could skyrocket because of the Strait of Hormuz issue and the volatility in the area.
Yesterday the price of oil rallied another $8, jumping out of the head and shoulders pattern I had been selling, and now it looks like it may be looking at that "stealth" open gap up near 112. "Stealth" because it looks filled with the eye, but technically the close on on April 7th was 112, and the high the next day was only 109.19.
With the Fed talking and Mag 7 reporting, did the 8% rally in oil get overlooked?
Now, with a less than enthusiastic reaction to the Mag 7 earnings following a massive rally, what can we expect?
With many investors looking at the 2025 "V" bottom as the road map, and perhaps saying, I'm not going to miss the rally this year... maybe it doesn't work out the same? That may be exactly why the angle of incline is so much sharper this year. More people jumped in out of FOMO (fear of missing out.)
Look at the difference one month out from the lows this year compared to last year. The "fool me once" crowd were not going to be fooled again, but as I keep asking, has this one gone too far, too fast, and with oil up and Mag 7 disappointing to some degree, do we have the formula for some volatility on the downside?
The S&P 500 (C-fund) was basically flat yesterday as we headed into last night's earnings fest. Microsoft is the 3rd heaviest weighted stock in the S&P 500, Amazon is 4th, Alphabet (Google) is # 5 and #6 (common and class C shares) and Meta is #8. No wonder no one wanted to commit yesterday. Today we get Apple's earnings after the closing bell, and they are #2 on that weighted list. #1 Nvidia is not reporting until may 20.
According to sentimentrader.com: "On Monday, the S&P 500 closed at a record high. The next day, at least 1% more stocks hit a 52-week low than a 52-week high. In 70+ years of history, that's happened twice. Tuesday was one. January 3, 2000 was the other."
That's was the start of troubling two to three three years for the stock market.
I'm not super bearish. I actually expect new highs into the end of the year after Election Day, but between now and then, as the midterm election year plays out, I believe there is a good chance for more volatility, which isn't all that bad because it sets up trading opportunities.
Let's see what Apple serves up this afternoon. Amazon just went positive after hours during their earnings conference call.
Additional TSP Fund Charts:
DWCPF (S-fund) broke down technically yesterday. This is not a deal breaker for the rally, but it could still be considered a double top pullback now that the breakout failed - at least for a day or two. We'll see what today brings but those open gaps are still beckoning below.
ACWX (I-fund) was hit hard and lagged the other TSP funds: 1) Because the overseas markets were mostly closed before the Fed press conference, and 2) the dollar and yields rallied on the Fed outlook. The 20-day moving average is getting tested again.
BND (bonds / F-fund) got clobbered on the jump in yields yesterday, and now it is back below the wedge formation. The breakout to the upside earlier this month now looks like it was a fake out. I told you this chart / fund has always been tough to negotiate for me. The gap down by 72.80 could be in play again without a quick bounce back.
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
Updated monthly:
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 use additional methods and strategies to determine fund positions.
