The new week began with a decent gain in stocks, although maybe not the explosive rally the bulls were hoping for after the announcement of the tech tariff exemptions announced over the weekend. The indices made a nice comeback from the early afternoon lows, but the highs of the day were made near the opening bell so there was no piling on the rally. Small caps and the I-fund led with gains of about 1%, and bonds (F-fund) rebounded after last week's sell off.
The S&P 500 (C-fund) chart opened near the highs of the day but that put it back up near where last week's rally ran out of steam -- just under the 300-day average. That could be stubborn resistance since it held as support for a few weeks before it eventually broke down, and support once broken, can act as resistance. There is an open gap above that average that could garner some intraday interest, but a close or two above 5500+ would be a lot more bullish then where it is now. This could be a place where the rally might stall, but as I talked about yesterday, the "V" bottom look is more promising than the bear flag low in March.
The 10-year Treasury Yield pulled back after Friday spike and negative reversal. The longer-term chart in the middle shows a classic head and shoulders head test, which has so far held as resistance. This tends to be bearish and that's not a bad thing for yields or the stock market, although we don't want yields moving down too quickly as it may be an indication of a weakening economy.
The dollar falling is also not a bad thing for the stock market. I thought the dollar might find support and a turning point near that blue 200-day average several days ago, but it fell right through that and remains in a downtrend. This keeps the I-fund in play.
As the market digests the tariff situation, the volatility has kept bitcoin out of the headlines. It is currently sitting near 85,000, which is well off the highs near 110,00 made in January. So while the volatility in bitcoin can be off the charts, is it worth the risk?
Did you know that the TSP has a bitcoin fund in the Mutual Fund Window called Bitcoin Pro Fund - BTCFX? There are higher fees associated with many of these mutual funds available, but BTCFX it is a way to invest some of your TSP account in bitcoin for anyone interested. You can only put a maximum of 25% of your account in the fund.
This chart shows the 1-year return, 2-year return, 3-year, etc, down to the 14-year return when bitcoin was first created. It has beat the S&P 500 over every one of those time frames. Gold is actually up more over the last 4-year period, but otherwise bitcoin has outperformed both.
The chart is currently struggling below its major moving averages and remains in a downtrend, but with bitcoin down 23% off its highs, it's certainly worth considering for anybody who has been waiting for an opportunity to get exposure into bitcoin.
Although my wife has been holding some of that BTCFX in her TSP account for a while, I haven't made that move yet in my TSP, mostly because I do own and trade bitcoin ETFs in an IRA and personal accounts.
From tsp.gov: Holiday Closing
"Some financial markets will be closed on Friday, April 18, in observance of Good Friday. Consequently, the Thrift Savings Plan will not be updating share prices in any of the TSP funds for that day. Transactions that would have been processed Friday night (April 18) will be processed Monday night (April 21) at Monday's closing share prices."
DWCPF (S-fund) gained 1% on Monday and while it is nearly 200-points off the recent lows, so far there has not been explosive move or piling on from the bulls. It's actually below where it closed 4 days ago so it has been digesting that big gain from last Wednesday. It's not bad action, but we're still in a down trending market until we see some resistance broken. 2000 - 2030 looks possible in the short-term before it hits any major resistance.
ACWX (I-fund) is taking advantage of that falling dollar and it jumped back above its 200-day average yesterday. You can see that April 4th gap has nearly been filled and there are some major moving averages in that area as well. 54.50 will be a good test of that resistance.
BND (F-fund) rallied yesterday but it is already dealing with some of its resistance levels on the chart. Based on the bearish look of the 10-year Yield chart up top, this may have a good chance at overtaking that 72.50 area.
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.
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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 may use additional methods and strategies to determine fund positions.
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After the weekend announcement of those tech tariff exemptions, the futures open up on Sunday evening with the S&P 500 futures up about 40 points or 0.8%. After another volatile day of trading, the S&P 500 closed up 43 points, or about 0.8%. That's a good day but it wasn't the FOMO reaction many expected. The S&P 500 (C-fund) chart opened near the highs of the day but that put it back up near where last week's rally ran out of steam -- just under the 300-day average. That could be stubborn resistance since it held as support for a few weeks before it eventually broke down, and support once broken, can act as resistance. There is an open gap above that average that could garner some intraday interest, but a close or two above 5500+ would be a lot more bullish then where it is now. This could be a place where the rally might stall, but as I talked about yesterday, the "V" bottom look is more promising than the bear flag low in March.
The 10-year Treasury Yield pulled back after Friday spike and negative reversal. The longer-term chart in the middle shows a classic head and shoulders head test, which has so far held as resistance. This tends to be bearish and that's not a bad thing for yields or the stock market, although we don't want yields moving down too quickly as it may be an indication of a weakening economy.
The dollar falling is also not a bad thing for the stock market. I thought the dollar might find support and a turning point near that blue 200-day average several days ago, but it fell right through that and remains in a downtrend. This keeps the I-fund in play.
As the market digests the tariff situation, the volatility has kept bitcoin out of the headlines. It is currently sitting near 85,000, which is well off the highs near 110,00 made in January. So while the volatility in bitcoin can be off the charts, is it worth the risk?
Did you know that the TSP has a bitcoin fund in the Mutual Fund Window called Bitcoin Pro Fund - BTCFX? There are higher fees associated with many of these mutual funds available, but BTCFX it is a way to invest some of your TSP account in bitcoin for anyone interested. You can only put a maximum of 25% of your account in the fund.
This chart shows the 1-year return, 2-year return, 3-year, etc, down to the 14-year return when bitcoin was first created. It has beat the S&P 500 over every one of those time frames. Gold is actually up more over the last 4-year period, but otherwise bitcoin has outperformed both.
The chart is currently struggling below its major moving averages and remains in a downtrend, but with bitcoin down 23% off its highs, it's certainly worth considering for anybody who has been waiting for an opportunity to get exposure into bitcoin.
Although my wife has been holding some of that BTCFX in her TSP account for a while, I haven't made that move yet in my TSP, mostly because I do own and trade bitcoin ETFs in an IRA and personal accounts.
From tsp.gov: Holiday Closing
"Some financial markets will be closed on Friday, April 18, in observance of Good Friday. Consequently, the Thrift Savings Plan will not be updating share prices in any of the TSP funds for that day. Transactions that would have been processed Friday night (April 18) will be processed Monday night (April 21) at Monday's closing share prices."
DWCPF (S-fund) gained 1% on Monday and while it is nearly 200-points off the recent lows, so far there has not been explosive move or piling on from the bulls. It's actually below where it closed 4 days ago so it has been digesting that big gain from last Wednesday. It's not bad action, but we're still in a down trending market until we see some resistance broken. 2000 - 2030 looks possible in the short-term before it hits any major resistance.
ACWX (I-fund) is taking advantage of that falling dollar and it jumped back above its 200-day average yesterday. You can see that April 4th gap has nearly been filled and there are some major moving averages in that area as well. 54.50 will be a good test of that resistance.
BND (F-fund) rallied yesterday but it is already dealing with some of its resistance levels on the chart. Based on the bearish look of the 10-year Yield chart up top, this may have a good chance at overtaking that 72.50 area.
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.
