Stocks were modestly lower last week as the indices digested the gains of a powerful 3-week rally. Rising tensions in the Middle East saw oil prices rise and investors may have been content to take some profits. There's not a whole lot of good news out there right now so we'll have to see whether that precipitates more of a pullback, or if stocks want to continue to climb the proverbial wall of worry.
Here are the weekly, monthly, and annual TSP fund returns for the week ending June 13:
The SPY (S&P 500 / C-fund) retraced some of the gains from the recent breakout, but that is not uncommon. There were a few breakouts on this chart recently, depending where you mark the breakout points, so those areas would be where we could expect support to hold in a rising trend. The top of the rising wedge (blue) was tested over the last couple of days, and held, as did the old rising resistance line (red.) That's what the bulls want to see - old resistance act as support after a breakout.
Chart provided courtesy of www.decisionpoint.com, analysis by TSP Talk
The small caps of the Wilshire 4500 Index pulled after testing the March highs and while the pullback has been a little more steep than you'd like to see, it can still be considered a bull flag at this point. Bull flags tend to break to the upside as the prior one did a couple of weeks ago, so next week will be the test for this one. There isn't much more room for error here for a bull flag.
Chart provided courtesy of www.decisionpoint.com, analysis by TSP Talk
Bonds have been pulling back and this IEF 7 to 10 year bond ETF broke below a couple of rising support lines before finding support at the 50-dat EMA. This looks like a chart that may want to breakdown further but until the 50-day EMA breaks (below 102.50) we can't rule out a bounce here.
Chart provided courtesy of www.decisionpoint.com, analysis by TSP Talk
Good luck and thanks for reading! We will be back here next week with another TSP Wrap Up. You can read our daily market commentary at TSP Talk Market Commentary.If you need some help deciding what to do with your account, perhaps one of our premium services can help.
Tom Crowley
www.tsptalk.com
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