Stocks bucked the recent trend yesterday by rallying despite a move higher in the dollar, yields and oil. Perhaps it was positioning in front of the Jackson Hole Symposium as investors may be anticipating some dovish comments from the Fed on Friday or, with trading volume near the lowest levels of the year, it could be that traders have backed off while forced pension type buying kept the indices buoyant. Just a guess. The Dow gained 60-points and the S&P added a dozen, while small caps led with a nice gain near 1%. With yields up again, bonds and the F-fund were down.
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We got some mixed earnings from Nvidia (NVDA), Salesforce (CRM), and Snowflake (SNOW) after the bell yesterday. Nvidia was the highlight and it was off about 5% after reporting and basically hit their reduced warning estimates. The worst part is that they went from 60% growth last year to forecasting a 17% decline for the next quarter.
Salesforce was trading down about 6% after hours, and it is a Dow component so that should weigh on that index. Snowflake was actually up big (16%), but to honest, besides being a software company, I don't even know what they do, and I don't know how much of an impact it will have on the indices.
Tomorrow is the highly anticipated Jackson Hole Symposium where we get to hear Jerome Powell comment on the economy and inflation so get ready for some possible fireworks.
Last year's event did trigger a short term rally but if you recall, Jerome Powell was talking very confidently about how the inflation we were seeing (last August) was going to be "transitory", and of course that hasn't aged well and he couldn't have been more wrong. With that said, how optimistic can we expect him to be this coming Friday?
The dollar was up big early on Wednesday, knocked on the double top door again, but slip back down, although it did hold on enough to close with a modest gain.
The price of oil was up again yesterday pushing the price of a barrel of oil near $95. It is now challenging the 200-day EMA.
And the yield on the 10-year Treasury was up yet again, closing at 3.1% and the highest level since June.
With all of that happening it was a a good showing for stocks to hold onto the gains that they got yesterday, but there are some over head open gaps, and the indices had gotten quite oversold in the short-term and some relief is not a big surprise.
I was thinking that a continued sell off into Powell's speech on Friday could set up a good buying opportunity, but if we start seeing a bounce into that speech, we could see the opposite. They ever make it easy.
The S&P 500 (C-fund) had a sharp two day sell off but it has been treading water for the last two days in front of the Jackson Hole Symposium. There is a large open gap above 4200 that will likely get filled at some point, but right now it is back trading in that area (4060-4160) that has seen some consolidation each time it gets in there. It is about 57 points above the 50-day EMA.
The DWCPF (S-fund) had a big day and I didn't draw it in because it may be early to say but that could be a bear flag if it continues to hang near that recent low on Monday. The gaps are better targets at this point.
EFA (I-fund) was up slightly.
BND (Bonds / F-fund) was down yet again but it is starting to flirt with some possible support near 74.70.
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
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Thanks for reading. I appreciate it. 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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We got some mixed earnings from Nvidia (NVDA), Salesforce (CRM), and Snowflake (SNOW) after the bell yesterday. Nvidia was the highlight and it was off about 5% after reporting and basically hit their reduced warning estimates. The worst part is that they went from 60% growth last year to forecasting a 17% decline for the next quarter.
Salesforce was trading down about 6% after hours, and it is a Dow component so that should weigh on that index. Snowflake was actually up big (16%), but to honest, besides being a software company, I don't even know what they do, and I don't know how much of an impact it will have on the indices.
Tomorrow is the highly anticipated Jackson Hole Symposium where we get to hear Jerome Powell comment on the economy and inflation so get ready for some possible fireworks.
Last year's event did trigger a short term rally but if you recall, Jerome Powell was talking very confidently about how the inflation we were seeing (last August) was going to be "transitory", and of course that hasn't aged well and he couldn't have been more wrong. With that said, how optimistic can we expect him to be this coming Friday?
The dollar was up big early on Wednesday, knocked on the double top door again, but slip back down, although it did hold on enough to close with a modest gain.
The price of oil was up again yesterday pushing the price of a barrel of oil near $95. It is now challenging the 200-day EMA.
And the yield on the 10-year Treasury was up yet again, closing at 3.1% and the highest level since June.
With all of that happening it was a a good showing for stocks to hold onto the gains that they got yesterday, but there are some over head open gaps, and the indices had gotten quite oversold in the short-term and some relief is not a big surprise.
I was thinking that a continued sell off into Powell's speech on Friday could set up a good buying opportunity, but if we start seeing a bounce into that speech, we could see the opposite. They ever make it easy.
The S&P 500 (C-fund) had a sharp two day sell off but it has been treading water for the last two days in front of the Jackson Hole Symposium. There is a large open gap above 4200 that will likely get filled at some point, but right now it is back trading in that area (4060-4160) that has seen some consolidation each time it gets in there. It is about 57 points above the 50-day EMA.
The DWCPF (S-fund) had a big day and I didn't draw it in because it may be early to say but that could be a bear flag if it continues to hang near that recent low on Monday. The gaps are better targets at this point.
EFA (I-fund) was up slightly.
BND (Bonds / F-fund) was down yet again but it is starting to flirt with some possible support near 74.70.
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. I appreciate it. 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.
