Stocks resumed Friday's pullback with another weak day of trading in the stock market. The Dow lost 162-points on the day and the losses were broad and impacted most of the major indices, although small caps held up well and closed with a small gain despite giving up some bigger early gains. Bonds were down as yields moved higher.
[TABLE="align: center"]
[TR]
[TD="align: center"]
[/TD]
[TD]
[/TD]
[TD="width: 284, align: center"] Daily TSP Funds Return
[TABLE="align: center"]
[TR]
[TD="align: right"][/TD]
[/TR]
[/TABLE]
[/TD]
[/TR]
[/TABLE]
Before I forget, this will be a short week of trading as the stock and bond markets are closed on Friday for Good Friday. There is no official word posted on the tsp.gov website but historically they haven't been processing interfund transfers that day. Since there will be no trading and the TSP won't process transfers, we will also take the day off and not update our market commentaries, nor post premium reports on Friday.
And speaking of holidays, Friday may have begun a pre-holiday reversal. That is, the trend leading up to a holiday week often reverses before a holiday, only to resume after the holiday. This week could be one of those weeks and, as we look at some of the charts, it comes near the top of the recent ascending trading ranges so it may have happened either way.
It could turn out to be another pullback in the indices to the rising moving averages, as we have seen in many charts. In the case of the Nasdaq, it would be the 30-day moving average. Or it could just be a couple of days of drifting lower, creating another bull flag as we have also seen often this year on the Nasdaq.
The 10-year Yield has bounced off the 50-day EMA, helping the case for the inverted head and shoulders pattern theory that we have been espousing. The dip into the right shoulder has given the stock market some relief as investors are on board with the Fed's comments about three interest rate cuts this year, but the inverted head and shoulders pattern may be telling us otherwise - as these tend to break above the resistance line (above 4.35% in this case.)
The dollar pulled back yesterday after Friday's rally, and that helped push commodity prices higher as we saw oil, gold, and bitcoin move higher yesterday. It did not help stocks, although you never know if they would have been down further if the dollar was not lower yesterday.
So the short holiday week got off to a weak start, and that may be normal in a bullish trending market, but the larger trend does tend to resume after the holiday so it's tough to be overly sure if these down days this week have any other meaning?
The S&P 500 (C-fund) is pulling back slightly, not unlike the pullback in February that turned out to be more of a bull flag that quickly broke back to the upside. That dip did not make it back down to its 15-day EMA, but I suppose that is a possibility at anytime.
DWCPF (S-fund) was up early yesterday and doing just fine until the final hour or so of trading when the small caps pulled back with the rest of the market. The good news here for the bulls was that the S-fund held in positive territory.
EFA (I-fund) is also forming some kind of small bullish flag, within a larger looking bull flag pattern. It looks fine as long as the 79 - 78.50 areas hold.
BND (Bonds / F-fund) pulled back, filling in an open gap after last week's decent rally. No harm done, but resistance looks to be holding.
Thanks so much for reading! We'll see you back here tomorrow.
Tom Crowley
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
Daily Market Commentary Archives
To get weekly or daily notifications when we post new commentary, sign up HERE.
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"]
[TD]
[/TD]
[TD="width: 284, align: center"] Daily TSP Funds Return
[TR]
[TD="align: right"][/TD]
[/TR]
[/TABLE]
[/TD]
[/TR]
[/TABLE]
Before I forget, this will be a short week of trading as the stock and bond markets are closed on Friday for Good Friday. There is no official word posted on the tsp.gov website but historically they haven't been processing interfund transfers that day. Since there will be no trading and the TSP won't process transfers, we will also take the day off and not update our market commentaries, nor post premium reports on Friday.
And speaking of holidays, Friday may have begun a pre-holiday reversal. That is, the trend leading up to a holiday week often reverses before a holiday, only to resume after the holiday. This week could be one of those weeks and, as we look at some of the charts, it comes near the top of the recent ascending trading ranges so it may have happened either way.
It could turn out to be another pullback in the indices to the rising moving averages, as we have seen in many charts. In the case of the Nasdaq, it would be the 30-day moving average. Or it could just be a couple of days of drifting lower, creating another bull flag as we have also seen often this year on the Nasdaq.
The 10-year Yield has bounced off the 50-day EMA, helping the case for the inverted head and shoulders pattern theory that we have been espousing. The dip into the right shoulder has given the stock market some relief as investors are on board with the Fed's comments about three interest rate cuts this year, but the inverted head and shoulders pattern may be telling us otherwise - as these tend to break above the resistance line (above 4.35% in this case.)
The dollar pulled back yesterday after Friday's rally, and that helped push commodity prices higher as we saw oil, gold, and bitcoin move higher yesterday. It did not help stocks, although you never know if they would have been down further if the dollar was not lower yesterday.
So the short holiday week got off to a weak start, and that may be normal in a bullish trending market, but the larger trend does tend to resume after the holiday so it's tough to be overly sure if these down days this week have any other meaning?
The S&P 500 (C-fund) is pulling back slightly, not unlike the pullback in February that turned out to be more of a bull flag that quickly broke back to the upside. That dip did not make it back down to its 15-day EMA, but I suppose that is a possibility at anytime.
DWCPF (S-fund) was up early yesterday and doing just fine until the final hour or so of trading when the small caps pulled back with the rest of the market. The good news here for the bulls was that the S-fund held in positive territory.
EFA (I-fund) is also forming some kind of small bullish flag, within a larger looking bull flag pattern. It looks fine as long as the 79 - 78.50 areas hold.
BND (Bonds / F-fund) pulled back, filling in an open gap after last week's decent rally. No harm done, but resistance looks to be holding.
Thanks so much for reading! We'll see you back here tomorrow.
Tom Crowley
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
Daily Market Commentary Archives
To get weekly or daily notifications when we post new commentary, sign up HERE.
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.
