Stocks exploded on Monday, which was kind of a surprise given the holiday-like atmosphere with the bond market and many banks closed on the day. I was expecting maybe a quiet, slightly bullish day, and I'm not sure what to make of it exactly. We didn't see huge internal numbers, and the VIX was actually positive, so the big rally was a little interesting, if not just impressive. The Dow gained 251-points and the Nasdaq had a huge day.
[TABLE="align: center"]
[TR]
[TD="align: center"] Daily TSP Funds Return
[TABLE="align: center"]
[TR]
[TD="align: right"] [/TD]
[/TR]
[/TABLE]
[/TD]
[TD][/TD]
[TD="align: center"]
[/TD]
[/TR]
[/TABLE]
The share prices above reflect the returns for the action on Friday in the TSP, since the TSP did not post share prices for Monday because of the holiday. Tuesday's share prices will reflect the action in the markets for both Monday and Tuesday.
Internally it was all positive, but not the 5 to 1 advancing to declining volume like we had been seeing last week. At less than 2 to 1 in the NYSE, I would call that disappointing, but it was a weird holiday-like day of trading so perhaps it was an anomaly. The Nasdaq was up more than 2.5% and volume was also just over 2 - 1 in favor of the advancers.
Perhaps the reason for the mediocre internals was that the much of the gains in the indices came from the biggest of the big on the day like Apple and Amazon which added huge numbers to their massive market caps with gains of +6.35% and +4.75 respectively. On Friday we talked about the Nasdaq 100 looking like it was ready to pop, and how that may help the S&P 500, which had been lagging the small caps.
Here's the Nasdaq100 chart that we posted on Friday (after Thursday's close):
And here is where it is just two trading days later...
And of course this helped the S&P 500 to more than double the return of the small caps on Monday. Now the S&P 500 and the Nasdaq will be eyeballing those prior highs, where the next level of resistance would kick in.
Be careful. The next election October surprise could hurt the market.
The S&P 500 (C-fund) took off on Monday morning, creating yet another open gap, and that makes three open gaps in the last three weeks. The inverted head and shoulders pattern did its job and already hit the initial upside target, which I had at 3525. Now it looks like a move to the prior highs is in the cards, but that doesn't mean a little backing and filling couldn't come first after four straight big up days.
The Equal Weighted S&P 500 (same 500 stocks all weighted equally) made a new high yesterday, so perhaps a double top is not in the cards for the S&P 500 - which is what TSP'ers care about being that the C-fund uses the above chart, not this one below - but it does tell us something: The broader market is acting fine.
The DWCPF (S-fund) rallied nicely although for the first time in a while it lagged the large caps. This one blasted through its prior highs last week, barely blinking in the process. I see 5 open gaps on this chart. Are they targets in waiting for any post election shenanigans?
The EFA (I-fund) poked its head above the old highs on Monday, and has made its way back into the red rising trading channel.
The I-fund making new highs before the S&P 500 may be a result of the recent pullback in the dollar, which is now back below the 50-day EMA and the 50-day Simple moving average.
The Dow Transportation Index has now closed above its September high for three straight days, which is a nice confirmation, but at this point we'd like to see any pullback hold at that old high. It wouldn't be a deal breaker if it came all the way down to the bottom of the red trading channel, but it wouldn't be fun.
BND (F-fund) had a nice day but it came up against the 50-day EMA and stalled, plus there is some descending resistance in the same area. Of course they could hold, but any upside action here may create a gap up opening above those levels.
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
Thanks for reading. We'll see you back here tomorrow.
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.
[TABLE="align: center"]
[TR]
[TD="align: center"] Daily TSP Funds Return
[TR]
[TD="align: right"] [/TD]
[/TR]
[/TABLE]
[/TD]
[TD][/TD]
[TD="align: center"]
[/TR]
[/TABLE]
The share prices above reflect the returns for the action on Friday in the TSP, since the TSP did not post share prices for Monday because of the holiday. Tuesday's share prices will reflect the action in the markets for both Monday and Tuesday.
Internally it was all positive, but not the 5 to 1 advancing to declining volume like we had been seeing last week. At less than 2 to 1 in the NYSE, I would call that disappointing, but it was a weird holiday-like day of trading so perhaps it was an anomaly. The Nasdaq was up more than 2.5% and volume was also just over 2 - 1 in favor of the advancers.
Perhaps the reason for the mediocre internals was that the much of the gains in the indices came from the biggest of the big on the day like Apple and Amazon which added huge numbers to their massive market caps with gains of +6.35% and +4.75 respectively. On Friday we talked about the Nasdaq 100 looking like it was ready to pop, and how that may help the S&P 500, which had been lagging the small caps.
Here's the Nasdaq100 chart that we posted on Friday (after Thursday's close):
And here is where it is just two trading days later...
And of course this helped the S&P 500 to more than double the return of the small caps on Monday. Now the S&P 500 and the Nasdaq will be eyeballing those prior highs, where the next level of resistance would kick in.
Be careful. The next election October surprise could hurt the market.
The S&P 500 (C-fund) took off on Monday morning, creating yet another open gap, and that makes three open gaps in the last three weeks. The inverted head and shoulders pattern did its job and already hit the initial upside target, which I had at 3525. Now it looks like a move to the prior highs is in the cards, but that doesn't mean a little backing and filling couldn't come first after four straight big up days.
The Equal Weighted S&P 500 (same 500 stocks all weighted equally) made a new high yesterday, so perhaps a double top is not in the cards for the S&P 500 - which is what TSP'ers care about being that the C-fund uses the above chart, not this one below - but it does tell us something: The broader market is acting fine.
The DWCPF (S-fund) rallied nicely although for the first time in a while it lagged the large caps. This one blasted through its prior highs last week, barely blinking in the process. I see 5 open gaps on this chart. Are they targets in waiting for any post election shenanigans?
The EFA (I-fund) poked its head above the old highs on Monday, and has made its way back into the red rising trading channel.
The I-fund making new highs before the S&P 500 may be a result of the recent pullback in the dollar, which is now back below the 50-day EMA and the 50-day Simple moving average.
The Dow Transportation Index has now closed above its September high for three straight days, which is a nice confirmation, but at this point we'd like to see any pullback hold at that old high. It wouldn't be a deal breaker if it came all the way down to the bottom of the red trading channel, but it wouldn't be fun.
BND (F-fund) had a nice day but it came up against the 50-day EMA and stalled, plus there is some descending resistance in the same area. Of course they could hold, but any upside action here may create a gap up opening above those levels.
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
Thanks for reading. We'll see you back here tomorrow.
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.
