The Sunday night futures were looking very negative so for the market to post slight to modest losses, and another gain for the Nasdaq, was a victory for the bulls in a way. The Dow lost 107-points and the big three indices are still flirting with their all-time highs, which is remarkable given how much we've seen some broader market indices do some correcting over the last several weeks, and even months. The Transports took another tough hit. Yields and the dollar rallied, and commodities had another rough day.
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The market was still digesting Friday's big jobs number and since that report was released we've seen a lot of choppy and mixed action as investors try to decipher what it means for stocks, the economy, interest rates, and the Fed's willingness to continue to throw money at the problems.
The internal numbers were mixed with the Nasdaq posting some solid advancing volumes, even though there were slightly more down issues than up on the day. The NYSE numbers were more negative but share volume wasn't too much worse than break even. Bottom line, the numbers are OK but it's showing that more stocks are struggling, but the ones being traded more heavily are doing OK.
The 10-year Treasury yield popped another 2% up 1.32% and it is now knocking on the 200-day EMA again. It failed there after a mid-July rally, and with an open gap down near 1.23%, it could do some backing and filling before moving above the moving averages. If it doesn't pull back first, we'll know that the bond market is taking that jobs report seriously and perhaps looking at it to be an igniter of yields and interest rates. That wouldn't be good for bonds and the F-fund, and maybe not for stocks either, depending how quickly yields move higher.
The dollar also got another post jobs report pop higher and it now seems to have its sights set on testing the July high. This is causing a little havoc in the commodities markets as gold, silver, oil, copper and lumber all too big hits again yesterday.
We get the CPI report (Consumer Price Index) on Wednesday and the PPI (Producer Price Index) on Thursday. Both can be market movers, especially in this environment where bond yields and inflationary data are being so closely analyzed.
The S&P 500 (C-fund) was basically flat on the day, fighting off some early selling pressure from the bears. It's one day off an all time closing high, it is flirting with an overhead rising resistance line, and it is doing all of this while parts of the U.S. are in a frenzy over a new variant of a pandemic virus. That's pretty good strength. Is it just a matter of investors getting too confident and riding the momentum, which could lead to another shock sell off, or is the economy in good shape despite the constant bad news, and good things are on the way? I guess your answer to that is where you'd be placing your bets.
The DWCPF (S-fund) continues to hold below that one stubborn resistance line near 2250. I do see one difference, which could mean a different outcome is coming I suppose, and that is that prior peaks were rigid points. The current action is more of a sideways consolidation for the last two weeks. Does this mean the sellers are getting less enthusiastic? Or are the bulls unable to push it to new highs despite several tries? It could be the right shoulder of a head and shoulders pattern.
The EFA (EAFE Index / I-fund) was down 0.05%, but the TSP gave the I-fund a a small gain for Monday despite the rally in the dollar yesterday. That may be given back today.
The Dow Transportation Index rolled over yet again so this has been quite choppy, but every time it moves up to test resistance, it gets swatted back down. It's been in a downtrend for months now yet the Dow, S&P 500, and Nasdaq are all staring at new highs. This is odd behavior and something has got to give.
The BND (bonds / F-fund) took another hit as yields rallied. It's now deep into the trading channel again, and perhaps looking to touch the 50-day EMA, which it hasn't done in over two months.
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. 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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The market was still digesting Friday's big jobs number and since that report was released we've seen a lot of choppy and mixed action as investors try to decipher what it means for stocks, the economy, interest rates, and the Fed's willingness to continue to throw money at the problems.
The internal numbers were mixed with the Nasdaq posting some solid advancing volumes, even though there were slightly more down issues than up on the day. The NYSE numbers were more negative but share volume wasn't too much worse than break even. Bottom line, the numbers are OK but it's showing that more stocks are struggling, but the ones being traded more heavily are doing OK.
The 10-year Treasury yield popped another 2% up 1.32% and it is now knocking on the 200-day EMA again. It failed there after a mid-July rally, and with an open gap down near 1.23%, it could do some backing and filling before moving above the moving averages. If it doesn't pull back first, we'll know that the bond market is taking that jobs report seriously and perhaps looking at it to be an igniter of yields and interest rates. That wouldn't be good for bonds and the F-fund, and maybe not for stocks either, depending how quickly yields move higher.
The dollar also got another post jobs report pop higher and it now seems to have its sights set on testing the July high. This is causing a little havoc in the commodities markets as gold, silver, oil, copper and lumber all too big hits again yesterday.
We get the CPI report (Consumer Price Index) on Wednesday and the PPI (Producer Price Index) on Thursday. Both can be market movers, especially in this environment where bond yields and inflationary data are being so closely analyzed.
The S&P 500 (C-fund) was basically flat on the day, fighting off some early selling pressure from the bears. It's one day off an all time closing high, it is flirting with an overhead rising resistance line, and it is doing all of this while parts of the U.S. are in a frenzy over a new variant of a pandemic virus. That's pretty good strength. Is it just a matter of investors getting too confident and riding the momentum, which could lead to another shock sell off, or is the economy in good shape despite the constant bad news, and good things are on the way? I guess your answer to that is where you'd be placing your bets.
The DWCPF (S-fund) continues to hold below that one stubborn resistance line near 2250. I do see one difference, which could mean a different outcome is coming I suppose, and that is that prior peaks were rigid points. The current action is more of a sideways consolidation for the last two weeks. Does this mean the sellers are getting less enthusiastic? Or are the bulls unable to push it to new highs despite several tries? It could be the right shoulder of a head and shoulders pattern.
The EFA (EAFE Index / I-fund) was down 0.05%, but the TSP gave the I-fund a a small gain for Monday despite the rally in the dollar yesterday. That may be given back today.
The Dow Transportation Index rolled over yet again so this has been quite choppy, but every time it moves up to test resistance, it gets swatted back down. It's been in a downtrend for months now yet the Dow, S&P 500, and Nasdaq are all staring at new highs. This is odd behavior and something has got to give.
The BND (bonds / F-fund) took another hit as yields rallied. It's now deep into the trading channel again, and perhaps looking to touch the 50-day EMA, which it hasn't done in over two months.
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. 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.
