Space
Investors took the opportunity for some profit taking ending a four week stretch of gains for U.S. stocks. The bulls and bears fought for direction all week which flattened out the charts enough to lean the investor into a risk off mentality. It didn't help that volume was low so a few bad headlines was all that was needed to drive down the whole market. It was the small cap stocks that were punished the most. The S-fund lagged the TSP funds with a 3.20% loss for the week but its success early in the month still leaves it with a 3.52% gain for August to outperform the other TSP funds for the month. The C-fund was down a mere 1.16% in comparison, but the action left an imprint on the S&P 500 chart's technical situation.
Of course, as usual, the Federal Reserve is on the mind of investors, or at least that's how financial media paints it. The last CPI report gave investors the notion that inflation has peaked therefore the Federal Reserve does not need to raise borrowing costs as aggressively as they have and suggested they will. But Fed members are coming out publicly saying this is not the case. The Fed does not know what the lag is between their rate changes and the economic effect. Fed members suggest the Fed will continue the rate hike campaign at the rate we've seen in order to eventually reach the Fed's inflation target of 2%. The latest 12-month CPI increase was 8.5%. Eyes are glued on the September 20-21 FOMC meeting and until then speculation will move a typically low volume market.
The charts have lost some technical stamina from rising support, but there is more support established. Many ponder whether Friday's action was the beginning of a deeper sell-off or just a release of tension after the market got too extended. It is likely to force some to put on the brakes but that will lead to an oscillation of prices leading up to the FOMC meeting later in September.
Bonds were down with stocks this week. The F-fund was down 0.88% for the week.
Looking for an edge on your TSP return? Get the Last Look Report for as low as $4.19 / month. The report is a daily email on the TSP Talk AutoTracker moves, news, forum threads, and more before the IFT deadline. The service is aimed to help you make your own IFT decisions by giving you relative information 30 min prior to the deadline including where the members of TSP Talk are moving their money.
Here are the weekly, monthly, and annual TSP fund returns for the week ending August 19:
SPY (S&P 500 / C-fund) changed course this week after more than a month of extension. The ETF had risen above its 200-day EMA earlier this month, but it was the 200-day Simple Moving Average that proved to be enough resistance to pause buying and increase profit taking. SPY has a trio of support below with the highs of June, the 20-day EMA, and the 200-day EMA all at about the same price. The C-fund may have ended its four-week streak of gains but saw the least damage among the TSP stock funds with a loss of 1.16% for the week.
There is a good stretch of prices for SPY before it can test its most recent highs establish in late March and April. Not shown here is the 200-day SMA that marked provoked selling this week.
The Dow Completion Index (S-fund) turned around its momentum after reaching its 200-day EMA, a moving average SPY surpassed in the previous week. An open gap was nearly closed during Friday's sell-off but the lows of the day did not reach the bottom of the open gap and instead matched up with the highs of June. The 20-day and 50-day EMAs are not far below the current price for support as well. The S-fund lagged the TSP funds for the week with a loss of 3.20% but still maintains the best return for August among the TSP funds at +3.52%.
EFA (EAFE Index / I-fund) made a poor technical move as the ETF slipped below rising support, the 20-day EMA, and the 50-day EMA. An open gap from the previous week was filled in the decline and another opened when the ETF opened down Friday. EFA made a significant move trade above its 50-day EMA in late July but made it less than a month before falling below it again Friday. The I-fund was not far behind the S-fund in losses this week with a loss of 2.93%. The big difference for the funds is the I-fund is now down 1.36% for August.
BND (Bonds / F-fund) continued to trade down in the falling trading channel we suspected was a bull-flag last week. Bull-flags tend to break up but instead the falling trading channel may be tested for support first. The ETF gapped down Friday to accumulate most of the losses for the week. The F-fund ended this week with a loss of 0.88% and is back below its 50-day EMA for the first time since mid-July.
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 the Market Comments page. If you need more help deciding what to do with your account, perhaps one of our Premium Services can help.
Thomas A Crowley
www.tsptalk.com
Last Look Report
Facebook | Twitter
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.
Investors took the opportunity for some profit taking ending a four week stretch of gains for U.S. stocks. The bulls and bears fought for direction all week which flattened out the charts enough to lean the investor into a risk off mentality. It didn't help that volume was low so a few bad headlines was all that was needed to drive down the whole market. It was the small cap stocks that were punished the most. The S-fund lagged the TSP funds with a 3.20% loss for the week but its success early in the month still leaves it with a 3.52% gain for August to outperform the other TSP funds for the month. The C-fund was down a mere 1.16% in comparison, but the action left an imprint on the S&P 500 chart's technical situation.
Of course, as usual, the Federal Reserve is on the mind of investors, or at least that's how financial media paints it. The last CPI report gave investors the notion that inflation has peaked therefore the Federal Reserve does not need to raise borrowing costs as aggressively as they have and suggested they will. But Fed members are coming out publicly saying this is not the case. The Fed does not know what the lag is between their rate changes and the economic effect. Fed members suggest the Fed will continue the rate hike campaign at the rate we've seen in order to eventually reach the Fed's inflation target of 2%. The latest 12-month CPI increase was 8.5%. Eyes are glued on the September 20-21 FOMC meeting and until then speculation will move a typically low volume market.
The charts have lost some technical stamina from rising support, but there is more support established. Many ponder whether Friday's action was the beginning of a deeper sell-off or just a release of tension after the market got too extended. It is likely to force some to put on the brakes but that will lead to an oscillation of prices leading up to the FOMC meeting later in September.
Bonds were down with stocks this week. The F-fund was down 0.88% for the week.
Looking for an edge on your TSP return? Get the Last Look Report for as low as $4.19 / month. The report is a daily email on the TSP Talk AutoTracker moves, news, forum threads, and more before the IFT deadline. The service is aimed to help you make your own IFT decisions by giving you relative information 30 min prior to the deadline including where the members of TSP Talk are moving their money.
Here are the weekly, monthly, and annual TSP fund returns for the week ending August 19:
SPY (S&P 500 / C-fund) changed course this week after more than a month of extension. The ETF had risen above its 200-day EMA earlier this month, but it was the 200-day Simple Moving Average that proved to be enough resistance to pause buying and increase profit taking. SPY has a trio of support below with the highs of June, the 20-day EMA, and the 200-day EMA all at about the same price. The C-fund may have ended its four-week streak of gains but saw the least damage among the TSP stock funds with a loss of 1.16% for the week.
There is a good stretch of prices for SPY before it can test its most recent highs establish in late March and April. Not shown here is the 200-day SMA that marked provoked selling this week.
The Dow Completion Index (S-fund) turned around its momentum after reaching its 200-day EMA, a moving average SPY surpassed in the previous week. An open gap was nearly closed during Friday's sell-off but the lows of the day did not reach the bottom of the open gap and instead matched up with the highs of June. The 20-day and 50-day EMAs are not far below the current price for support as well. The S-fund lagged the TSP funds for the week with a loss of 3.20% but still maintains the best return for August among the TSP funds at +3.52%.
EFA (EAFE Index / I-fund) made a poor technical move as the ETF slipped below rising support, the 20-day EMA, and the 50-day EMA. An open gap from the previous week was filled in the decline and another opened when the ETF opened down Friday. EFA made a significant move trade above its 50-day EMA in late July but made it less than a month before falling below it again Friday. The I-fund was not far behind the S-fund in losses this week with a loss of 2.93%. The big difference for the funds is the I-fund is now down 1.36% for August.
BND (Bonds / F-fund) continued to trade down in the falling trading channel we suspected was a bull-flag last week. Bull-flags tend to break up but instead the falling trading channel may be tested for support first. The ETF gapped down Friday to accumulate most of the losses for the week. The F-fund ended this week with a loss of 0.88% and is back below its 50-day EMA for the first time since mid-July.
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 the Market Comments page. If you need more help deciding what to do with your account, perhaps one of our Premium Services can help.
Thomas A Crowley
www.tsptalk.com
Last Look Report
Facebook | Twitter
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.
