08/12/25
Stocks wobbled on Monday, but did not break as the relentless rally continues to hold near the all time highs. The Dow gave up 200-points but otherwise the losses were modest. Things may start heating up today with the CPI report coming out, because the Fed may or not be cutting interest rates next month, and this this report may help make that decision.
(The most current commentary is always posted here: www.tsptalk.com/comments.php)
This market is making it tough for those of us expecting a pullback. We have seen some cracks in some of the secondary indices like the small caps and the Transports, but those Mag 7 type of stocks continue to do a good job of holding up the large cap indices despite the internal weakness. Nasdaq trading volume was positive because of the gains in some heavily traded big tech stocks like Tesla.
And that ratio of 149 new 52-week highs on the Nasdaq vs. 140 new lows is kind of shocking considering the entire index is trading near the all time highs. I would have expected that to be a lot more lopsided on the new high side.
I am willing to flip on my semi-defensive position, and a good place to start would be to see a breakout above the previous highs on the weekly chart of the S&P 500. The flat top that I pointed out yesterday is not always a good look as we saw in February, and it held again on day one of the new week.
The market is running on momentum, hope, and the potential for growth under the current economic conditions. Ironically, if the strength of the economy increases, the chances of an interest rate cut next month might decrease, but right now there is an 87% probability of a rate cut in September.
The daily S&P 500 (C-fund) chart is still in limbo just below its all time intraday high at the end of July as the index continues to try to retrace that reversal day. I've been anticipating a pullback, and the S&P has actually been down 7 of the last 10 days, so we're currently witnessing a stealth pullback - one we can't see very well.
The PMO indicator has been below its average since then negative reversal day, yet we're still near those all time highs.
This may be the most concerning chart out there right now. One of the major market leading indices is the Transportation Index and it is rolling over with another 1% loss yesterday after failing at the 200-day average. That is also likely a bear flag on the daily chart.
The weekly chart shows just how vulnerable it is at this current pivot point at the 200-week moving average. It either holds here, or the dam may break.
We'll get the CPI report (Consumer Prices) this morning before the opening bell.
Then the PPI report (Wholesale Prices) will be released on Wednesday. On Friday we'll get the Retail Sales data.
The DWCPF / S-fund continues to rollover below resistance while the S&P 500 is still flirting with its all time highs.
ACWX (I-fund) took a hit yesterday as it couldn't withstand the heat of the 0.40% gain in the dollar. 62 looks like a potentially key level, and the dollar (UUP) is back above its neckline of the inverted head and shoulders pattern. This looks very interesting here. If you're in the I-fund, this is not where you'd want ACWX to run out of steam, nor where you'd want to see the dollar rally.
BND (bonds / F-fund) was up modestly as yields slipped a little lower. The old resistance line (blue) continues to hold as support, now that BND is above it.
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.
Stocks wobbled on Monday, but did not break as the relentless rally continues to hold near the all time highs. The Dow gave up 200-points but otherwise the losses were modest. Things may start heating up today with the CPI report coming out, because the Fed may or not be cutting interest rates next month, and this this report may help make that decision.
(The most current commentary is always posted here: www.tsptalk.com/comments.php)
| Daily TSP Funds Return
More returns |
This market is making it tough for those of us expecting a pullback. We have seen some cracks in some of the secondary indices like the small caps and the Transports, but those Mag 7 type of stocks continue to do a good job of holding up the large cap indices despite the internal weakness. Nasdaq trading volume was positive because of the gains in some heavily traded big tech stocks like Tesla.
And that ratio of 149 new 52-week highs on the Nasdaq vs. 140 new lows is kind of shocking considering the entire index is trading near the all time highs. I would have expected that to be a lot more lopsided on the new high side.
I am willing to flip on my semi-defensive position, and a good place to start would be to see a breakout above the previous highs on the weekly chart of the S&P 500. The flat top that I pointed out yesterday is not always a good look as we saw in February, and it held again on day one of the new week.
The market is running on momentum, hope, and the potential for growth under the current economic conditions. Ironically, if the strength of the economy increases, the chances of an interest rate cut next month might decrease, but right now there is an 87% probability of a rate cut in September.
The daily S&P 500 (C-fund) chart is still in limbo just below its all time intraday high at the end of July as the index continues to try to retrace that reversal day. I've been anticipating a pullback, and the S&P has actually been down 7 of the last 10 days, so we're currently witnessing a stealth pullback - one we can't see very well.
The PMO indicator has been below its average since then negative reversal day, yet we're still near those all time highs.
This may be the most concerning chart out there right now. One of the major market leading indices is the Transportation Index and it is rolling over with another 1% loss yesterday after failing at the 200-day average. That is also likely a bear flag on the daily chart.
The weekly chart shows just how vulnerable it is at this current pivot point at the 200-week moving average. It either holds here, or the dam may break.
We'll get the CPI report (Consumer Prices) this morning before the opening bell.
Then the PPI report (Wholesale Prices) will be released on Wednesday. On Friday we'll get the Retail Sales data.
The DWCPF / S-fund continues to rollover below resistance while the S&P 500 is still flirting with its all time highs.
ACWX (I-fund) took a hit yesterday as it couldn't withstand the heat of the 0.40% gain in the dollar. 62 looks like a potentially key level, and the dollar (UUP) is back above its neckline of the inverted head and shoulders pattern. This looks very interesting here. If you're in the I-fund, this is not where you'd want ACWX to run out of steam, nor where you'd want to see the dollar rally.
BND (bonds / F-fund) was up modestly as yields slipped a little lower. The old resistance line (blue) continues to hold as support, now that BND is above it.
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.
