Sorry - I forgot to make this blog from my Thursday Daily Commentary (www.tsptalk.com/comments.html) available here last night. Better late than never, I hope...
09/01/11
After losing all of an early 150+ point gain, the Dow rallied late and closed up 54-points. Economic data was weak, but a little better than expected, and the bulls continued to buy. Will they buy again today in front of tomorrow's important August jobs report?
For the TSP, the C-fund was up 0.51% yesterday, the S-fund gained 0.15%, the I-fund made 2.13%, and the F-fund (bonds) lost 0.12%.
The S&P 500 nearly hit the 50-day EMA as it continues to test the upper end of the large bear flag formation. We have seen some positive things from this market, but there are so many reasons to believe this rally will run out of steam. Of course the more people who think this, the less likely it will happen.
Chart provided courtesy of www.decisionpoint.com, analysis by TSP Talk
The S&P 500 has now regained 50% of its drop from 1350 to 1100, most of that on very light trading volume. A 50% retracement is a common area for a rally to find resistance.
The Nasdaq also tested the 50-day EMA after its 10% plus rally of off the lows. There is still an open gap about 100-points lower than where it closed yesterday.
Chart provided courtesy of www.decisionpoint.com, analysis by TSP Talk
The daily put / call ratios are showing typical contrarian sentiment. Yesterday's dumb money ratios were up (bullish) with the Equity put / call ratio moving close to the 0.50 2011 highs. At the same time the smart money OEX put / call ratio saw a move down near 3.0. That's close to their highest (most bearish) one-day readings of the year.
Chart provided courtesy of www.decisionpoint.com, analysis by TSP Talk
I usually pay more attention to the 10-day moving average of these put / call ratios, but they did not show the extreme difference between the smart and dumb money as this daily chart did.
I should really look into updating these charts but I have been lazy and continue to use sentimenTrader.com's older seasonality data. It is several years old but it does contain 56-years worth of data.
Chart provided courtesy of www.sentimentrader.com
Obviously September has not been a very good month historically.
Tomorrow we get the August jobs report and estimates are looking for a gain of 73,000 jobs and an unemployment rate of 9.1%. Both are very poor numbers but the market has likely priced these in and what it will be looking for are any surprises to the up or downside.
Mark September 7 on your calendar as it could be a very important day for the markets next week. The German supreme court will rule on whether the government broke the law with last year’s euro zone and Greek bailout packages. I still think the European debt issues is a big concern for both the international and U.S. markets.
Administrative Note: I am starting a "Last Man Standing" NFL football pool. It's real easy and it's free. For more info see TSP Talk NFL Pool. The deadline to join is September 11 at 10 AM ET.
Thanks for reading! We'll see you back here tomorrow.
Tom Crowley
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.
09/01/11
After losing all of an early 150+ point gain, the Dow rallied late and closed up 54-points. Economic data was weak, but a little better than expected, and the bulls continued to buy. Will they buy again today in front of tomorrow's important August jobs report?
For the TSP, the C-fund was up 0.51% yesterday, the S-fund gained 0.15%, the I-fund made 2.13%, and the F-fund (bonds) lost 0.12%.
The S&P 500 nearly hit the 50-day EMA as it continues to test the upper end of the large bear flag formation. We have seen some positive things from this market, but there are so many reasons to believe this rally will run out of steam. Of course the more people who think this, the less likely it will happen.
Chart provided courtesy of www.decisionpoint.com, analysis by TSP Talk
The S&P 500 has now regained 50% of its drop from 1350 to 1100, most of that on very light trading volume. A 50% retracement is a common area for a rally to find resistance.
The Nasdaq also tested the 50-day EMA after its 10% plus rally of off the lows. There is still an open gap about 100-points lower than where it closed yesterday.
Chart provided courtesy of www.decisionpoint.com, analysis by TSP Talk
The daily put / call ratios are showing typical contrarian sentiment. Yesterday's dumb money ratios were up (bullish) with the Equity put / call ratio moving close to the 0.50 2011 highs. At the same time the smart money OEX put / call ratio saw a move down near 3.0. That's close to their highest (most bearish) one-day readings of the year.
Chart provided courtesy of www.decisionpoint.com, analysis by TSP Talk
I usually pay more attention to the 10-day moving average of these put / call ratios, but they did not show the extreme difference between the smart and dumb money as this daily chart did.
I should really look into updating these charts but I have been lazy and continue to use sentimenTrader.com's older seasonality data. It is several years old but it does contain 56-years worth of data.
Chart provided courtesy of www.sentimentrader.com
Obviously September has not been a very good month historically.
Tomorrow we get the August jobs report and estimates are looking for a gain of 73,000 jobs and an unemployment rate of 9.1%. Both are very poor numbers but the market has likely priced these in and what it will be looking for are any surprises to the up or downside.
Mark September 7 on your calendar as it could be a very important day for the markets next week. The German supreme court will rule on whether the government broke the law with last year’s euro zone and Greek bailout packages. I still think the European debt issues is a big concern for both the international and U.S. markets.
Administrative Note: I am starting a "Last Man Standing" NFL football pool. It's real easy and it's free. For more info see TSP Talk NFL Pool. The deadline to join is September 11 at 10 AM ET.
Thanks for reading! We'll see you back here tomorrow.
Tom Crowley
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.
