RS or bear flag?
Stocks continued to pull back early last week, but a 2-day bounce off of the 50-day EMA’s on Thursday and Friday gave the bulls hope that the market rally could resume this coming week.
For the TSP, the C-fund was down 0.62% last week, the S-fund lost 0.56%, and the I-fund fell 1.04%. Bonds (F-fund) gained 0.83%, and the G-fund was up 0.06%.
For the month of April the C-fund is down 0.39%, the S-fund is off 0.66%, the I-fund is still in positive territory with a 1.25% again, while the F-fund (bonds) is up 0.53%, and the G-fund has made 0.12%.
We came into last week with the S&P 500 looking like it wanted to pullback and we speculated that we could be seeing the start of a right shoulder of an inverted head and shoulders pattern. This is the chart we posted last week…
Chart provided courtesy of www.decisionpoint.com
Now let’s take a look at what happened.
Chart provided courtesy of www.decisionpoint.com
The pullback did continue and it reached the 50-day EMA before bouncing off of that potential support. If the inverted head and shoulders pattern does continue to form we could see the S&P 500 testing the neckline (1340) before long. The concern is that the bounce off of the 50-day EMA could be a potential bear flag, which would of course be bearish.
The chart of the Nasdaq is in a similar situation so I will isolate the bear flag. Bear flags tend to break downward, but a sharp rally above the flag early this coming week would take care of that.
Chart provided courtesy of www.decisionpoint.com
You can see that the 50-day EMA acted as support during the formation of the left shoulder (LS) so the question remains, will the bear flag break down or will the 50-day EMA hold and see a completion of the right shoulder (RS)? That is what we will be looking for this week.
Good luck, and thanks for reading. We will be back here next week with another TSP Wrap Up.
Tom Crowley
www.tsptalk.com
Weekly Wrap-Ups Archive
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.
Stocks continued to pull back early last week, but a 2-day bounce off of the 50-day EMA’s on Thursday and Friday gave the bulls hope that the market rally could resume this coming week.
For the TSP, the C-fund was down 0.62% last week, the S-fund lost 0.56%, and the I-fund fell 1.04%. Bonds (F-fund) gained 0.83%, and the G-fund was up 0.06%.
For the month of April the C-fund is down 0.39%, the S-fund is off 0.66%, the I-fund is still in positive territory with a 1.25% again, while the F-fund (bonds) is up 0.53%, and the G-fund has made 0.12%.
We came into last week with the S&P 500 looking like it wanted to pullback and we speculated that we could be seeing the start of a right shoulder of an inverted head and shoulders pattern. This is the chart we posted last week…
Chart provided courtesy of www.decisionpoint.com
Now let’s take a look at what happened.
Chart provided courtesy of www.decisionpoint.com
The pullback did continue and it reached the 50-day EMA before bouncing off of that potential support. If the inverted head and shoulders pattern does continue to form we could see the S&P 500 testing the neckline (1340) before long. The concern is that the bounce off of the 50-day EMA could be a potential bear flag, which would of course be bearish.
The chart of the Nasdaq is in a similar situation so I will isolate the bear flag. Bear flags tend to break downward, but a sharp rally above the flag early this coming week would take care of that.
Chart provided courtesy of www.decisionpoint.com
You can see that the 50-day EMA acted as support during the formation of the left shoulder (LS) so the question remains, will the bear flag break down or will the 50-day EMA hold and see a completion of the right shoulder (RS)? That is what we will be looking for this week.
Good luck, and thanks for reading. We will be back here next week with another TSP Wrap Up.
Tom Crowley
www.tsptalk.com
Weekly Wrap-Ups Archive
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.
