Stocks opened sharply lower on Thursday after an overnight sell off in the futures market, but it didn't take long for the dip buyers to come in and do some shopping. The Dow was down a couple of hundred points in early trading but closed down just 23. The Nasdaq and small caps each took a 1% loss but the S&P saw a more most 0.36% decline. Bonds were down, the dollar rallied, which helped push gold and the I-fund down.
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The dollar moved up sharply so just as prices tend to go up when the dollar is falling, prices get pressured when the dollar rallies. There was an open gap on the UUP chart that is getting some attention, as is the 50-day EMA. There is another open gap near 24.55, but it would have to get above the 50-day EMA to get there.
We saw gold, copper, corn, soybeans, and of course stocks all down on the day because of the pressure from the dollar.
The Nasdaq was down sharply but it closed off the lows after a bounce off the 50-day EMA. It really needs to hold here because the chart looks suspect, but in a bull market, as long as the 50-day average is holding, it can't be all bad. But if that is a bear flag and the 50-day EMA gives way, it's a long way down to the next support.
The recent darlings of the Nasdaq and the stock market are looking worrisome as well. Tesla, Apple, and Amazon all closed below their 200-day moving averages yesterday, and those all look like bearish head and shoulders patterns on the charts. In the case of Netflix (bottom right), it has already broken down from an H&S and failed on a test back up to the 200-day EMA. Trouble brewing in tech world?
We get the May jobs report this morning (Friday) and estimates are looking for a gain of 675K - 750K jobs and an unemployment rate of 5.9%. If you recall last month was a giant miss, off by nearly a million, and I'm guessing they aren't going to let that happen again. Would a big upside surprise bring on a rally, or interest rate hike concerns?
The S&P 500 (C-fund) pulled back from that double top area but it didn't take long for the dip buyers to show up once the 20-day EMA was tagged. We can see how often that is the case at the 20 and 50 EMAs, but sometimes the first test holds, and subsequent tests don't - at least more recently with the 20-day average. 4125 looks like a possible target on any further pullback for several reasons.
The DWCPF (S-fund) also tagged the 20-day EMA and bounced but the high yesterday hit the bottom of a gap that was filled in recent days. There's still some resistance overhead so there could be some pressure here, but as I mentioned above, if the 50-day EMA is holding it is tough to get too bearish.
The EFA / I-fund was down as you'd expect when the dollar is down 0.6%, but we also knew the top of the recent trading channel was hit and thought there could be some selling at that resistance. So far that is the case, but will it come all the way back down to the 50-day EMA lime prior pullbacks?
The Dow Transportation Index fell through some support yesterday when it lost 0.48%. There is more support just above 15,250, and then the 50-day EMA. This looks a little toppy but if it can stabilize in this area, it could just be consolidating before the next leg higher.
BND (bonds / F-fund) was down but it also held at its 50-day EMA, so there was a theme throughout the market yesterday. That could be a small bull flag forming which could have the power to push it above the 200-day EMA, but there is also a ton of resistance in the 85.20 - 85.45 area.
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
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Thanks for reading. Have a great weekend!
Tom Crowley
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 use additional methods and strategies to determine fund positions.
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The dollar moved up sharply so just as prices tend to go up when the dollar is falling, prices get pressured when the dollar rallies. There was an open gap on the UUP chart that is getting some attention, as is the 50-day EMA. There is another open gap near 24.55, but it would have to get above the 50-day EMA to get there.
We saw gold, copper, corn, soybeans, and of course stocks all down on the day because of the pressure from the dollar.
The Nasdaq was down sharply but it closed off the lows after a bounce off the 50-day EMA. It really needs to hold here because the chart looks suspect, but in a bull market, as long as the 50-day average is holding, it can't be all bad. But if that is a bear flag and the 50-day EMA gives way, it's a long way down to the next support.
The recent darlings of the Nasdaq and the stock market are looking worrisome as well. Tesla, Apple, and Amazon all closed below their 200-day moving averages yesterday, and those all look like bearish head and shoulders patterns on the charts. In the case of Netflix (bottom right), it has already broken down from an H&S and failed on a test back up to the 200-day EMA. Trouble brewing in tech world?
We get the May jobs report this morning (Friday) and estimates are looking for a gain of 675K - 750K jobs and an unemployment rate of 5.9%. If you recall last month was a giant miss, off by nearly a million, and I'm guessing they aren't going to let that happen again. Would a big upside surprise bring on a rally, or interest rate hike concerns?
| Admin note: Last warning,.. While prepping for our new premium feature, the Last Look Report, and diving into our payment processing code, I decided it was time to finally clean things up and get rid of the annoying .95 or .99 cents on some of our subscription prices and round up a penny to get whole dollars. So you may be seeing the price of a monthly subscription to RevShark for example, which has been $19.95 for 15 years, is going to $20 even. TSP Talk Plus will go up a penny from $17.99 to $18. I hope this isn't a problem for any of you. As for The Last Look Report, we're planning on implementing it next Monday with free access through that week, with a possible sneak peek later this week to a few forum members for some feedback. The info will come in a daily email from TommyIV about 30 minutes before the IFT deadline to help us make any last minute allocation decisions. It will also be posted in the premium area once the free trial is over. I'm sure it will evolve after we get started. The cost will be $10 a month, or $5 for those already subscribed to another service. Here's some info and a sample of what subscribers may get each morning, plus a place to add you email to the list to receive the report next week. The Last Look Report Info. We worked on the backend stuff all weekend and we've already made a few changes from what you see there. I hope you like it. Thanks. |
The S&P 500 (C-fund) pulled back from that double top area but it didn't take long for the dip buyers to show up once the 20-day EMA was tagged. We can see how often that is the case at the 20 and 50 EMAs, but sometimes the first test holds, and subsequent tests don't - at least more recently with the 20-day average. 4125 looks like a possible target on any further pullback for several reasons.
The DWCPF (S-fund) also tagged the 20-day EMA and bounced but the high yesterday hit the bottom of a gap that was filled in recent days. There's still some resistance overhead so there could be some pressure here, but as I mentioned above, if the 50-day EMA is holding it is tough to get too bearish.
The EFA / I-fund was down as you'd expect when the dollar is down 0.6%, but we also knew the top of the recent trading channel was hit and thought there could be some selling at that resistance. So far that is the case, but will it come all the way back down to the 50-day EMA lime prior pullbacks?
The Dow Transportation Index fell through some support yesterday when it lost 0.48%. There is more support just above 15,250, and then the 50-day EMA. This looks a little toppy but if it can stabilize in this area, it could just be consolidating before the next leg higher.
BND (bonds / F-fund) was down but it also held at its 50-day EMA, so there was a theme throughout the market yesterday. That could be a small bull flag forming which could have the power to push it above the 200-day EMA, but there is also a ton of resistance in the 85.20 - 85.45 area.
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
For more info our other premium services, please go here... www.tsptalk.com/premiums.html
To get weekly or daily notifications when we post new commentary, sign up HERE.
Thanks for reading. Have a great weekend!
Tom Crowley
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 use additional methods and strategies to determine fund positions.
