Stocks were mixed on Tuesday, although not exactly a turnaround Tuesday for the S&P 500 as the small gain made it a 4-day winning streak. We haven't seen 5 consecutive positive days for that index since January. The Nasdaq was down slightly and small caps did close down after a negative reversal day. Bond yields were down but remain above stubborn support.
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It was a very slow day for stocks and once again trading volume remains quite low. Perhaps investors are in a comfort zone where they don't feel a need to sell, but they're not doing a lot of buying either - at least the big money who can move volume numbers and the market. As we said, it's a quiet week on the economic calendar, and while earnings are still coming in, most of the market movers have already reported. The next big earnings report comes on May 22 when Nvidia reports.
Yields were down but the 10-year yield is holding firmly above the 50-day EMA and the bottom of its rising channel, which is support coming off the March lows. I can see a retest of the 4.35% area where the yield broke out in April, but for now the support is holding.
The dollar was up for a second straight day and it moved back above some resistance levels, although there's more near yesterday's highs.
The S&P 500 kept its winning streak alive but after a big three day rally it did run out of steam a bit yesterday despite the small gain, and the spinning top candlestick formation is a sign of indecision and potentially indicating a pause is coming.
The S-fund made a higher high over Monday's highs but it stalled and closed down on the day creating a negative reversal formation, which also indicates the potential for a little breather here. Both of these charts have open gaps below that could be pullback targets if the rally does stall.
The Dow Transportation Index was up yesterday but I continue to keep an eye on this chart while it trades below its 200-day average. It's clearly being sticky to that level so the bears are pushing on it, but the bulls could give up if it can't make a move above that resistance soon.
For those still interested in the summer of 2023 comparison; that rally lasted for 11 trading days before rolling over again, and yesterday was day #12 for the current rally off the April lows. The August 2023 rally gained 4.9% before failing, while this current rally is now 4.8% off the low.
I won't be in the office for most of the afternoon and late into the evening today so I may be delayed in responding to any correspondence. It also means that I may have to put together Thursday's Commentary before I leave, and that could mean it will be brief as I may not have the closing data. Sorry for any inconvenience.
The S&P 500 (C-fund) was up for a 4th straight day and it's been quite a run off the April low, and even more impressive off the early May low from just last week. The bear flag is broken but it is still in the area if the chart does any backing and filling in the next few days after yesterday's spinning top showed signs of buyer fatigue. The open gaps are potential targets for any pullback.
DWCPF (S-fund) has had a nice run gains-wise, but this chart is lot more choppy with yesterday being the 2nd negative reversal day in the last three days. It's just kind of jumpy right now. It filled an overhead open gap and peaked there yesterday, but technically the open gap actually goes up to the March 9th close near 2060.
The EFA (I-fund) is closing in on testing its previous high and that brings up the potential for a double top pullback. This isn't a bearish set up unless you are only looking out a week or so.
BND (bonds / F-fund) was up again and that's 5 straight gains for the BND. The blue gap has been filled and it closed within that gap after not holding above it near the intraday highs. This looks better but there's still work to be done, and it may all depend on whether the 10-year Treasury Yield (chart is up top) remains above 4.45% or not, as that is where the rising support is right now on that chart.
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
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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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It was a very slow day for stocks and once again trading volume remains quite low. Perhaps investors are in a comfort zone where they don't feel a need to sell, but they're not doing a lot of buying either - at least the big money who can move volume numbers and the market. As we said, it's a quiet week on the economic calendar, and while earnings are still coming in, most of the market movers have already reported. The next big earnings report comes on May 22 when Nvidia reports.
Yields were down but the 10-year yield is holding firmly above the 50-day EMA and the bottom of its rising channel, which is support coming off the March lows. I can see a retest of the 4.35% area where the yield broke out in April, but for now the support is holding.
The dollar was up for a second straight day and it moved back above some resistance levels, although there's more near yesterday's highs.
The S&P 500 kept its winning streak alive but after a big three day rally it did run out of steam a bit yesterday despite the small gain, and the spinning top candlestick formation is a sign of indecision and potentially indicating a pause is coming.
The S-fund made a higher high over Monday's highs but it stalled and closed down on the day creating a negative reversal formation, which also indicates the potential for a little breather here. Both of these charts have open gaps below that could be pullback targets if the rally does stall.
The Dow Transportation Index was up yesterday but I continue to keep an eye on this chart while it trades below its 200-day average. It's clearly being sticky to that level so the bears are pushing on it, but the bulls could give up if it can't make a move above that resistance soon.
For those still interested in the summer of 2023 comparison; that rally lasted for 11 trading days before rolling over again, and yesterday was day #12 for the current rally off the April lows. The August 2023 rally gained 4.9% before failing, while this current rally is now 4.8% off the low.
I won't be in the office for most of the afternoon and late into the evening today so I may be delayed in responding to any correspondence. It also means that I may have to put together Thursday's Commentary before I leave, and that could mean it will be brief as I may not have the closing data. Sorry for any inconvenience.
The S&P 500 (C-fund) was up for a 4th straight day and it's been quite a run off the April low, and even more impressive off the early May low from just last week. The bear flag is broken but it is still in the area if the chart does any backing and filling in the next few days after yesterday's spinning top showed signs of buyer fatigue. The open gaps are potential targets for any pullback.
DWCPF (S-fund) has had a nice run gains-wise, but this chart is lot more choppy with yesterday being the 2nd negative reversal day in the last three days. It's just kind of jumpy right now. It filled an overhead open gap and peaked there yesterday, but technically the open gap actually goes up to the March 9th close near 2060.
The EFA (I-fund) is closing in on testing its previous high and that brings up the potential for a double top pullback. This isn't a bearish set up unless you are only looking out a week or so.
BND (bonds / F-fund) was up again and that's 5 straight gains for the BND. The blue gap has been filled and it closed within that gap after not holding above it near the intraday highs. This looks better but there's still work to be done, and it may all depend on whether the 10-year Treasury Yield (chart is up top) remains above 4.45% or not, as that is where the rising support is right now on that chart.
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.
