Stocks opened sharply higher yesterday, but oh those emotional Monday morning gaps. You can't always trust them and yesterday's gap got filled late in the day as the Dow and S&P 500 gave up their hefty early gains and closed with modest losses. The Nasdaq was the leader as the stay at home tech stocks did most of the lifting. The Dow lost 185-points. Small caps also held onto a nice gain, but closed well off the morning highs.
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I don't know if it is related to the negative reversal, but it was announced yesterday that the U.S. agencies Treasury and Commerce Departments were victims of global cyber attacks over the last few months, with Russian hackers suspected as the culprits. There are investigations underway. Seems like a potential reason to take something off the table, for those who have a lot of profits to take.
The Electoral College voted on Monday to reiterate Joe Biden's win in the election. Again, I don't know if the market cared but stocks did start to tumble after the announcement. Is that it? Does the market move on from here or will the pending lawsuits keep this an ongoing issue? Again, I don't know who's trading on this anymore.
The stay at home trade was working yesterday as the Nasdaq led on the upside, while the NYSE saw a declining volume sharply outpacing advancing volume.
That left the equal weighted S&P500 index is rough shape as it lost 0.72% on the day. Nothing serious, but you can see some potential glaring cracks forming on the chart.
There is a two day FOMC meeting kicking off on Tuesday. There are no expected changes to interest rates, but the Fed policy statement can always be a market mover, and that will be on Wednesday.
The S&P 500 (C-fund) closed lower for a 4th straight day and closed right about where it opened on December 1st, after the gap up open that day. It doesn't feel like a four day losing streak, and perhaps that is because the Nasdaq and small caps have held up despite the losses in the S&P. That 3625 area looks like a key support level with not much support below that.
The DWCPF Index / S-fund closed with a solid gain despite the negative reversal. The rising trading channel remains intact, but the rubber band keeps stretching.
The EFA / I-fund was up slightly as the dollar was down sharply. However the dollar reversed after hitting a double bottom support line, so we'll see if it has any bounce in going forward. No change to the technical picture as the channel remains intact, but those gaps. Have I mentioned the open gaps? OK, everyday, but one day one or all of them will get filled.
The Dow Transportation Index, clearly not part of the stay at home trade, took one on the chin on Monday as it fell 2.3% on the day, breaking down further from its rising channel.
BND (Bonds / F-fund) pulled back sharply early on Monday, but bounced back after finding support at the top of that bull flag it had broken out of on Friday.
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.
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I don't know if it is related to the negative reversal, but it was announced yesterday that the U.S. agencies Treasury and Commerce Departments were victims of global cyber attacks over the last few months, with Russian hackers suspected as the culprits. There are investigations underway. Seems like a potential reason to take something off the table, for those who have a lot of profits to take.
The Electoral College voted on Monday to reiterate Joe Biden's win in the election. Again, I don't know if the market cared but stocks did start to tumble after the announcement. Is that it? Does the market move on from here or will the pending lawsuits keep this an ongoing issue? Again, I don't know who's trading on this anymore.
The stay at home trade was working yesterday as the Nasdaq led on the upside, while the NYSE saw a declining volume sharply outpacing advancing volume.
That left the equal weighted S&P500 index is rough shape as it lost 0.72% on the day. Nothing serious, but you can see some potential glaring cracks forming on the chart.
There is a two day FOMC meeting kicking off on Tuesday. There are no expected changes to interest rates, but the Fed policy statement can always be a market mover, and that will be on Wednesday.
The S&P 500 (C-fund) closed lower for a 4th straight day and closed right about where it opened on December 1st, after the gap up open that day. It doesn't feel like a four day losing streak, and perhaps that is because the Nasdaq and small caps have held up despite the losses in the S&P. That 3625 area looks like a key support level with not much support below that.
The DWCPF Index / S-fund closed with a solid gain despite the negative reversal. The rising trading channel remains intact, but the rubber band keeps stretching.
The EFA / I-fund was up slightly as the dollar was down sharply. However the dollar reversed after hitting a double bottom support line, so we'll see if it has any bounce in going forward. No change to the technical picture as the channel remains intact, but those gaps. Have I mentioned the open gaps? OK, everyday, but one day one or all of them will get filled.
The Dow Transportation Index, clearly not part of the stay at home trade, took one on the chin on Monday as it fell 2.3% on the day, breaking down further from its rising channel.
BND (Bonds / F-fund) pulled back sharply early on Monday, but bounced back after finding support at the top of that bull flag it had broken out of on Friday.
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.
