That was a little different. It was more choppy range bound action but the late selling was different. That may have been as a result of the anticipated outcome of the debt ceiling meetings going on and were concluding after the closing bell. The Dow lost 1% or 336-points. Small caps reversed Monday's big gains with a big loss, so the resistance on that chart is holding firm again. Bonds were down.
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From the short sound bite I heard after the bell it sounded like McCarthy suggested that they were not very close to making a deal, but a deal by the end of the week was not out of the question, and Chuck Schumer sounded slightly optimistic despite no resolution. Because of that we did see the S&P 500 futures pop 6 - 7 points higher just after the closing bell yesterday, but this emotional market is starving for info so the reactions could be overblown.
The market is always looking for the next catalyst and with the economic calendar quiet this week, the negotiations in Washington have become the show. For that reason I will keep this brief rather than giving you futile speculation.
The action remains in a range and that range has gotten even tighter over the last week or so. The S&P 500 (C-fund) is coiling for a big move, but I think we can probably see what we want to see in a chart like this. being above the rising support line and the 50-day EMA keep the bulls interested, but the bears are keeping the pressure on as well, especially in other indices.
It was a weird day with yields and the dollar being up, suggesting stronger economic conditions, yet small caps, Transports, and the energy sector were all down sharply, which is a play on economic weakness. I think the debt ceiling negotiations just have investors on edge and the rhymes and reasons just aren't there right now. It may be a matter of waiting and seeing if a deal can get done before the end of the month and perhaps we can't expect much from the bulls as long as there is no deal. That said, rumors and speculation could push and pull at the indices since investors probably will want to be quick to buy if and when a deal is announced.
The credit market had a bit of a shock yesterday as High Yield Corporate Bonds (HYG) was down 0.70%, which is a big move for that ETF, and that added to the bearish catalysts on the day.
There's just too many unknowns for me to confidently speculate on anything. If you believe a deal will be done this week, buying weakness may be the play. If you don't think they can get a deal done, getting or staying on the sidelines would be the play. I wish I knew, but we're being held hostage right now.
The DWCPF (S-fund) tanked yesterday, perhaps on higher yields, perhaps on another 1.5% decline in the regional bands, or perhaps on the energy sector's sell off. Add them up and the S-fund was down 1.6% a day after attempting another push above the 50-day EMA, which failed.
The EFA (I-fund) may have shown its first crack in a while as the ETF closed below the 20-day EMA for the first time since March 24. Nothing serious yet, but perhaps strike one.
BND (Bonds / F-fund) is trying to hold at this latest test of the 200-day EMA, as well as the bottom of a flag-like channel.
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 so much 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.
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From the short sound bite I heard after the bell it sounded like McCarthy suggested that they were not very close to making a deal, but a deal by the end of the week was not out of the question, and Chuck Schumer sounded slightly optimistic despite no resolution. Because of that we did see the S&P 500 futures pop 6 - 7 points higher just after the closing bell yesterday, but this emotional market is starving for info so the reactions could be overblown.
The market is always looking for the next catalyst and with the economic calendar quiet this week, the negotiations in Washington have become the show. For that reason I will keep this brief rather than giving you futile speculation.
The action remains in a range and that range has gotten even tighter over the last week or so. The S&P 500 (C-fund) is coiling for a big move, but I think we can probably see what we want to see in a chart like this. being above the rising support line and the 50-day EMA keep the bulls interested, but the bears are keeping the pressure on as well, especially in other indices.
It was a weird day with yields and the dollar being up, suggesting stronger economic conditions, yet small caps, Transports, and the energy sector were all down sharply, which is a play on economic weakness. I think the debt ceiling negotiations just have investors on edge and the rhymes and reasons just aren't there right now. It may be a matter of waiting and seeing if a deal can get done before the end of the month and perhaps we can't expect much from the bulls as long as there is no deal. That said, rumors and speculation could push and pull at the indices since investors probably will want to be quick to buy if and when a deal is announced.
The credit market had a bit of a shock yesterday as High Yield Corporate Bonds (HYG) was down 0.70%, which is a big move for that ETF, and that added to the bearish catalysts on the day.
There's just too many unknowns for me to confidently speculate on anything. If you believe a deal will be done this week, buying weakness may be the play. If you don't think they can get a deal done, getting or staying on the sidelines would be the play. I wish I knew, but we're being held hostage right now.
The DWCPF (S-fund) tanked yesterday, perhaps on higher yields, perhaps on another 1.5% decline in the regional bands, or perhaps on the energy sector's sell off. Add them up and the S-fund was down 1.6% a day after attempting another push above the 50-day EMA, which failed.
The EFA (I-fund) may have shown its first crack in a while as the ETF closed below the 20-day EMA for the first time since March 24. Nothing serious yet, but perhaps strike one.
BND (Bonds / F-fund) is trying to hold at this latest test of the 200-day EMA, as well as the bottom of a flag-like channel.
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 so much 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.
