Stocks rallied sharply after the jobs report was announced yesterday. The Dow closed up 75-points but the initial reaction to the jobs report was a triple digit gain shortly after the open.
[TABLE="width: 80%, align: center"]
[TR]
[TD="width: 300"]
[/TD]
[TD="align: center"] Daily TSP Funds Return[TABLE="width: 164"]
[TR]
[TD="align: right"] G-Fund:[/TD]
[TD="align: right"] +0.0063%[/TD]
[/TR]
[TR]
[TD="align: right"] F-fund:[/TD]
[TD="align: right"] +0.40%[/TD]
[/TR]
[TR]
[TD="align: right"] C-fund:[/TD]
[TD="align: right"] +0.57%[/TD]
[/TR]
[TR]
[TD="align: right"] S-fund:[/TD]
[TD="align: right"] +0.40%[/TD]
[/TR]
[TR]
[TD="align: right"] I-fund:[/TD]
[TD="align: right"] +0.89%[/TD]
[/TR]
[/TABLE]
[TABLE="width: 69%, align: center"]
[TR]
[TD="align: right"][/TD]
[/TR]
[/TABLE]
[/TD]
[/TR]
[/TABLE]
The I-fund led the way and yields fell as bonds rallied sharply, all as a result of the weak economic data that sent the dollar falling. So why did stocks and bonds rally, and the dollar fall? Because weak jobs data told investors that the Fed is less likely to stop the printing presses so they'll continue buy bond and make money available cheaply. Weak economic data sends yields lower making stocks more attractive, and the dollar is weakened because the money supply is increased, which helps the I-fund in particular.
The S&P 500 (SPY) is remaining in a steep narrow ascending trading channel (red) after breaking through the longer-term resistance line (blue). The S&P has been up in 9 of the last 10 trading days as bad news and good news seems to send it higher.
Chart provided courtesy of www.decisionpoint.com, analysis by TSP Talk
The Nasdaq has been performing even better although it did lag a bit yesterday gaining about a third of what the S&P 500 did. The open gaps are glaring and I would be surprised if the first one is not filled within the next week.
Chart provided courtesy of www.decisionpoint.com, analysis by TSP Talk
As I mentioned above, the dollar fell on the weak jobs report and the UUP made a new multi-year low. Not everything goes up when the dollar falls, but it does help the price of anything that is traded in dollars. The I-fund is directly impacted by the drop in the dollar and we saw that in the share price.
Chart provided courtesy of www.decisionpoint.com, analysis by TSP Talk
Some things like the price of oil falls when the economy weakens, so we did see oil fall yesterday. As I said not everything goes up when the dollar falls, but the weak dollar probably helped oil from falling further.
The price of gold is also greatly affected by the value of the dollar since it is considered a hedge against inflation, and that is what a weak dollar can do - trigger inflation. So the price of gold went up about $25 an oz. yesterday, or about 2% like this gold ETF.
Chart provided courtesy of www.decisionpoint.com, analysis by TSP Talk
Bonds rallied and yields dropped yesterday after the weak economic data. The IEF 7 to 10 year bond ETF is now testing its 200-day EMA. Bonds have been in a bear market for months. I would be surprised if they move unchallenged above the 200-day EMA on the first attempt.
Chart provided courtesy of www.decisionpoint.com, analysis by TSP Talk
The short-term trend is now up for bonds but there are two open gaps on this chart that may need to get filled first, and the 200-day EMA is usually strong resistance in a [bond] bear market.
I am going to be out of town for the rest of the week and a little busy so my schedule could be a little off from my normal routine, but the commentary and all of the premium reports will be posted.
One more thing. I am starting to have a problem with the email service I use for alerts. I have used the same service for years but for some reason we are starting to see inconsistent deliveries of the email alerts. Most are sent within minutes of initiating them but officially they can take up to an hour to go out and recently that has been happening. As some of you know, some of the premium service email alerts are very time sensitive so this is an issue and I am looking for alternatives. In the meantime, you may want to make sure you take a minute each morning to check if there are any changes to your service's allocations before the TSP transfer deadline. Sorry for the inconvenience.
In today's TSP Talk Plus report we go over a couple indicators that are showing some potential concerns for stocks.
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
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.
[TABLE="width: 80%, align: center"]
[TR]
[TD="width: 300"]
[TD="align: center"] Daily TSP Funds Return[TABLE="width: 164"]
[TR]
[TD="align: right"] G-Fund:[/TD]
[TD="align: right"] +0.0063%[/TD]
[/TR]
[TR]
[TD="align: right"] F-fund:[/TD]
[TD="align: right"] +0.40%[/TD]
[/TR]
[TR]
[TD="align: right"] C-fund:[/TD]
[TD="align: right"] +0.57%[/TD]
[/TR]
[TR]
[TD="align: right"] S-fund:[/TD]
[TD="align: right"] +0.40%[/TD]
[/TR]
[TR]
[TD="align: right"] I-fund:[/TD]
[TD="align: right"] +0.89%[/TD]
[/TR]
[/TABLE]
[TABLE="width: 69%, align: center"]
[TR]
[TD="align: right"][/TD]
[/TR]
[/TABLE]
[/TD]
[/TR]
[/TABLE]
The I-fund led the way and yields fell as bonds rallied sharply, all as a result of the weak economic data that sent the dollar falling. So why did stocks and bonds rally, and the dollar fall? Because weak jobs data told investors that the Fed is less likely to stop the printing presses so they'll continue buy bond and make money available cheaply. Weak economic data sends yields lower making stocks more attractive, and the dollar is weakened because the money supply is increased, which helps the I-fund in particular.
The S&P 500 (SPY) is remaining in a steep narrow ascending trading channel (red) after breaking through the longer-term resistance line (blue). The S&P has been up in 9 of the last 10 trading days as bad news and good news seems to send it higher.
Chart provided courtesy of www.decisionpoint.com, analysis by TSP Talk
The Nasdaq has been performing even better although it did lag a bit yesterday gaining about a third of what the S&P 500 did. The open gaps are glaring and I would be surprised if the first one is not filled within the next week.
Chart provided courtesy of www.decisionpoint.com, analysis by TSP Talk
As I mentioned above, the dollar fell on the weak jobs report and the UUP made a new multi-year low. Not everything goes up when the dollar falls, but it does help the price of anything that is traded in dollars. The I-fund is directly impacted by the drop in the dollar and we saw that in the share price.
Chart provided courtesy of www.decisionpoint.com, analysis by TSP Talk
Some things like the price of oil falls when the economy weakens, so we did see oil fall yesterday. As I said not everything goes up when the dollar falls, but the weak dollar probably helped oil from falling further.
The price of gold is also greatly affected by the value of the dollar since it is considered a hedge against inflation, and that is what a weak dollar can do - trigger inflation. So the price of gold went up about $25 an oz. yesterday, or about 2% like this gold ETF.
Chart provided courtesy of www.decisionpoint.com, analysis by TSP Talk
Bonds rallied and yields dropped yesterday after the weak economic data. The IEF 7 to 10 year bond ETF is now testing its 200-day EMA. Bonds have been in a bear market for months. I would be surprised if they move unchallenged above the 200-day EMA on the first attempt.
Chart provided courtesy of www.decisionpoint.com, analysis by TSP Talk
The short-term trend is now up for bonds but there are two open gaps on this chart that may need to get filled first, and the 200-day EMA is usually strong resistance in a [bond] bear market.
I am going to be out of town for the rest of the week and a little busy so my schedule could be a little off from my normal routine, but the commentary and all of the premium reports will be posted.
One more thing. I am starting to have a problem with the email service I use for alerts. I have used the same service for years but for some reason we are starting to see inconsistent deliveries of the email alerts. Most are sent within minutes of initiating them but officially they can take up to an hour to go out and recently that has been happening. As some of you know, some of the premium service email alerts are very time sensitive so this is an issue and I am looking for alternatives. In the meantime, you may want to make sure you take a minute each morning to check if there are any changes to your service's allocations before the TSP transfer deadline. Sorry for the inconvenience.
In today's TSP Talk Plus report we go over a couple indicators that are showing some potential concerns for stocks.
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
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.
