The Dow gained 6-points yesterday while the broader indices saw more meaningful gains. The price of oil also inched up again.
For the TSP, the C-fund was up 0.40% yesterday, the S-fund gained 0.56%, the I-fund added 0.35%, and the F-fund (bonds) fell 0.27%.
The S&P 500 looks like it is on another mission to hit the top of the rising trading channel (red line) and the angle of incline since the recent dip is even steeper than the original trading channel. This certainly looks bullish, but how long can this last? the S&P has now been up 8 of the last 9 days.
Chart provided courtesy of www.decisionpoint.com, analysis by TSP Talk
Not too much happened yesterday to change anything but lets quickly go over what I am keeping an eye on outside of the S&P 500...
The Dow Transportation Index has done a good job in holding onto the big gains it had last Thursday, but yesterday was the third day it attempted to breakout to a new high, and so far no new high. It is possible that this is the early stages of a bull flag.
Chart provided courtesy of www.decisionpoint.com, analysis by TSP Talk
The small caps of the Russell 2000 did breakout to a new high yesterday and while this looks really bullish, it is only day 1 of the breakout and the index has already run nearly 7% since the lows earlier this month.
Chart provided courtesy of www.decisionpoint.com, analysis by TSP Talk
Taking a look at the rally from the December low, into the February highs, then having a 7% pullback and another breakout...? This actually looks really good, technically. I don't know why I keep wanting to fight this.
Maybe this will help remind me... Oh, yeah... Oil is breaking out to the upside again. The bull flag has broken and new highs over $110 seems inevitable. The initial bull flag target is near $125 a barrel, and I am skeptical that stocks can ignore this kind of price action.
Chart provided courtesy of www.decisionpoint.com, analysis by TSP Talk
The yield on the 10-year T-note continues to move higher and has now closed for a 4th straight day over the 200-day EMA.
Chart provided courtesy of www.decisionpoint.com, analysis by TSP Talk
Bond prices and the F-fund have come down because of this, or I should say that yields have gone up because bond prices have come down. But no matter how we say it, as long as the yield remains above the 200-day EMA, the F-fund will likely perform sluggishly, unless the stock market happens to pullback and investors want to put money back into bonds for safety.
Thanks for reading! We'll see you back here tomorrow.
Tom Crowley
