09/16/25
Stocks started the week with another solid gain after a late rally took the indices back near the morning highs following some midday selling. Yields and the dollar were down helping stocks remain buoyant, and that also assisted the bond market / F-fund. Interestingly, the VIX (Volatility Index) was up 6% and that's odd on a day that stocks rallied as much as they did.
The big news this week is the Fed meeting, which begins today and will culminate with a policy statement and press conference tomorrow. The chances of a rate cut being announced is near 100% so it could be mayhem if they don't cut.
Here are the current probabilities going out to the December meeting and you can see there is virtually no chance of the Fed Funds rate staying the same, only a 2% chance of only seeing one cut between now and then, and a 71% chance that the rate cut between now and December will be 0.75% or more.
What happened after other Fed interest rate cuts when stocks were within 2% of an all time highs on the S&P 500?
It looks like there is a 50/50 chance that stocks will be higher a month from now, but after that the chances of gains gets better and better.
The S&P 500 / C-fund gapped up and continues to defy the odds as we are well into 5 months without a 3% pullback. At some point it should retest that 30-day moving average in green, which it has been doing once or twice a month, but those have been very shallow dips. Currently that 30-day average is sitting at 6451 and the S&P closed at 6615 yesterday, so that is 164 points in between, but the average is moving up each day.
We got another positive PMO crossover, which can mean being short-term overbought, but longer-term bullishness, although this indicator has been flashing false negative divergences for months so I don't know what to make of it.
By the way, there's also a negative divergence between the Nasdaq 100 and its advance / decline line.
Tomorrow might be a big day but the Fed may have to do something very unexpected to surprise us, since the world is expected that 0.25% interest rate cut.
The DWCPF* (S-fund) was up 0.21% yesterday as it forms a short-term bullish looking pennant formation on this 5-minute chart with an open gap down near 2470.
* There is a bad quote that occurred on DWCPF on September 3rd of 20,000 and it has distorted the chart, so until they fix that, this chart will be a 5-minute chart spanning just a few days.
ACWX (I-fund) got another assist from the dollar which was down 0.33% yesterday, and we saw a gains of 0.79% in this international fund as it tests the top of its rising trading channel.
BND (bonds / F-fund) closed at another new high as it comfortably trades above the old trading channel. This looks good but the open gap below 74 may be telling us that the Fed could shake things up, as gaps that large tend to get filled eventually.
Thanks so much for reading! We'll see you back 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 started the week with another solid gain after a late rally took the indices back near the morning highs following some midday selling. Yields and the dollar were down helping stocks remain buoyant, and that also assisted the bond market / F-fund. Interestingly, the VIX (Volatility Index) was up 6% and that's odd on a day that stocks rallied as much as they did.
| Daily TSP Funds Return
More returns |
The big news this week is the Fed meeting, which begins today and will culminate with a policy statement and press conference tomorrow. The chances of a rate cut being announced is near 100% so it could be mayhem if they don't cut.
Here are the current probabilities going out to the December meeting and you can see there is virtually no chance of the Fed Funds rate staying the same, only a 2% chance of only seeing one cut between now and then, and a 71% chance that the rate cut between now and December will be 0.75% or more.
What happened after other Fed interest rate cuts when stocks were within 2% of an all time highs on the S&P 500?
It looks like there is a 50/50 chance that stocks will be higher a month from now, but after that the chances of gains gets better and better.
The S&P 500 / C-fund gapped up and continues to defy the odds as we are well into 5 months without a 3% pullback. At some point it should retest that 30-day moving average in green, which it has been doing once or twice a month, but those have been very shallow dips. Currently that 30-day average is sitting at 6451 and the S&P closed at 6615 yesterday, so that is 164 points in between, but the average is moving up each day.
We got another positive PMO crossover, which can mean being short-term overbought, but longer-term bullishness, although this indicator has been flashing false negative divergences for months so I don't know what to make of it.
By the way, there's also a negative divergence between the Nasdaq 100 and its advance / decline line.
Tomorrow might be a big day but the Fed may have to do something very unexpected to surprise us, since the world is expected that 0.25% interest rate cut.
The DWCPF* (S-fund) was up 0.21% yesterday as it forms a short-term bullish looking pennant formation on this 5-minute chart with an open gap down near 2470.
* There is a bad quote that occurred on DWCPF on September 3rd of 20,000 and it has distorted the chart, so until they fix that, this chart will be a 5-minute chart spanning just a few days.
ACWX (I-fund) got another assist from the dollar which was down 0.33% yesterday, and we saw a gains of 0.79% in this international fund as it tests the top of its rising trading channel.
BND (bonds / F-fund) closed at another new high as it comfortably trades above the old trading channel. This looks good but the open gap below 74 may be telling us that the Fed could shake things up, as gaps that large tend to get filled eventually.
Thanks so much for reading! We'll see you back 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.
