tsptalk's Market Talk

[tsptalk]

December is off to a mixed start. Historically the Monday after Thanksgiving has a slight bearish bias, but the first few days of December have a bullish bias. This year the two collide and here we have a mixed open.

Unfortunately for the I-fund, the dollar is bouncing back today after last week's pre-holiday negative reversal.

The commodities are also mixed with gold down, oil up while bitcoin and yields are flat.

We have a bit of a holiday hangover but by Friday we'll get the November jobs report and December will be in full swing.

 

[WorkFE]

December is off to a mixed start. Historically the Monday after Thanksgiving has a slight bearish bias, but the first few days of December have a bullish bias. This year the two collide and here we have a mixed open.

Unfortunately for the I-fund, the dollar is bouncing back today after last week's pre-holiday negative reversal.

The commodities are also mixed with gold down, oil up while bitcoin and yields are flat.

We have a bit of a holiday hangover but by Friday we'll get the November jobs report and December will be in full swing.

The I-Fund seems to have found some footing. We will have to see how it finishes out the day.

 

[tsptalk]

Stocks are stumbling this morning after some turmoil in S. Korea. Once again we see big tech taking the lead as the vibrant rotation into smaller stocks has slowed down.

Yields are up but the action in stocks and bonds seems a little aimless as we digest the November gains and await Friday's jobs report. The JOLTS report showed more job openings and slumping hiring, if that tells us something about Friday's report.

Oil and gold are up this morning. Bitcoin is flat.

 

[tsptalk]

Stocks are up this morning, and the Dow and small caps are resuming their uptrend after a two-day pullback to start December. There are no major headlines other than some decent tech earnings.

I wondered how long it would take dip buyers to show up and while it's too early for the bulls to declare victory, the bears failed to make any progress in pulling the indices down so the bulls are trying to take control again. The irony is that the first few days in December tend to be bullish, but after the 3rd the seasonality calendar gets more of a bearish bias until Christmas week.

As I showed in Wednesday's commentary, the past three election years saw strong rallies for the next year, but in 2 of the last three there was a dip just before the end of December.

Oil is flat and gold and bitcoin are up,

 

[dannyboy]

Day to Day Market Analysis with tsptalk

I saw the returns for today. I think Santa is coming is coming to town and with Trump this causes Santa to go into overdrive?

 

[tsptalk]

Is bitcoin 100K a sign of a top for stocks?

There is certainly a frenzy with bitcoin hitting the milestone this week, but surprisingly sentiment toward stocks isn't overly heated.

On the CNN Fear and Greed Index it shows investors are just mildly on the "greed" side. Last I checked it was 57 on a scale of 0 to 100 with 100 being the extreme greed end.

https://www.cnn.com/markets/fear-and-greed

That said, stocks are quite overvalued on an historical basis, but everyone on Wall Street knows this and it allows equities to climb that wall of worry... perhaps until it gets extreme.

 

[tsptalk]

It was nearly a Goldilocks jobs report with 227k jobs created and an unemployment rate of 4.2%.

The 227K was near the upper end of estimates but not too hot to send yields higher.

The 4.2% was on the upper end of estimates as well pushing the probability of a rate cut later this month from 71% to 87%.

Stocks are happy with the results in early trading as most indices are positive.

Oil is down, gold is up and bitcoin is hovering just below 100K.

 

[tsptalk]

Monday morning is starting with a pop higher in small caps and the I-fund while large caps lag with the S&P 500 down modestly. The Dow and Nasdaq are flat.

The dollar is down helping commodity price, Gold, silver, and oil are all up. Bitcoin is still hovering near 100K.

Friday's jobs report feels like a distant memory and the market is now looking forward to next week's Fed meeting and possible rate cut.

And of course seasonality will play a role as we head into the less bullish mid-December stretch, but with many money managers lagging the market's return, the dip buying may be quick as they try to pad their annual reports with 2024 winners.

 

[tsptalk]

Yesterday was a rare exception for recent trading as I believe only one stock sector was up, but today it's back to an either / or market where one index is up and another is down. The Dow and small caps are negative right now while the S&P 500 and Nasdaq are positive. The Nasdaq is actually making a new high this morning.

Oracle is down sharply after reporting earnings yet the Nasdaq is leading on the upside with large cap techs like Google, Nvidia and Tesla up nicely.

This week is historically more bearish than we'd expect in December, but the indices are hanging around all time highs and the underinvested and underperforming money managers have to (or tend to) put some money to work before the end of the year to pad those annual reports.

Bitcoin hype had been hitting a frenzy level when 100K came into the picture, but profit taking at this lofty price has been holding back this week. That money has to go somewhere, which is a good excuse to keep any pullback in stocks muted.

The CPI report comes out tomorrow, which may give either the bulls or bears the ammunition to find a direction in stocks after this waffling period - especially in small caps, which are more interest rate sensitive.

 

[tsptalk]

It's early and we have seen repeatedly that what happens in the morning, doesn't always stay in the morning, but stocks are off to a good start after an acceptable CPI report that was inline with estimates.

The early rally in stocks keeps the C (S&P 500) and S-funds (DWCPF) above their 20-day moving averages, which ideal in a strong bull market.

Yields are down slightly but the chart isn't looking like it wants to head lower. It looks more like a low forming, which isn't the worst thing in the world. If yields start to tumble at this point it would likely be because of weakening economic data, and right now the stock market is fine with firm economic data and a range bound 10-year yield.

So, the charts are shaping up again, but it's the close that matters. We get the PPI report tomorrow and that may be more telling for the Fed regarding inflation.

By the way the odds of a rate cut next week just rose to 96% with that CPI data.

 

[tsptalk]

Stocks are slipping early this morning, giving back a chunk of yesterday's gains after a warmer than expected PPI report. Not only did the PPI come in 0.2% above estimates, but they revised October up to 0.3% from 0.2%. The Core PPI (excludes food and energy) actually fell.

PPI
Actual: 0.4%
B.com Forecast: 0.2%
B.com Cons: 0.3%
Prior: 0.3%
Revised From: 0.2%

Core PPI
Actual: 0.2%
B.com Forecast: 0.2%
B.com Cons: 0.2%
Prior: 0.3%

This is pushing the 10-year yield up to 4.3% and this may be why small caps are lagging to start the day.

The I-fund ETFs (ACWX and EFA) are down as well despite seeing gains in Europe and Japan. The dollar is even down a little, so I don't know. Hopefully one day I'll understand this

Oil, gold, silver, and bitcoin are all down.

Once again the close is more important than the open, but that PPI is troubling, although the odds of a rate cut next week is still 98%.

 

[WorkFE]

Hopefully one day I'll understand this

Let me know when you do.

 

[tsptalk]

Stocks opened higher this morning but it didn't take long for the rally to rollover and right now the Dow, S&P, and Nasdaq are fairly flat and losing steam. Small caps and the I-fund as yields and the dollar slide higher again.

I've been a little maniacal about the seasonality calendar, but so far it has been spot on for December. The 9th thru the 14th, even up to the 20th, has a history of slumping before the chart greatly improves later in the month.

Chart provided courtesy of www.sentimentrader.com

Oil is up, gold and other metals are down sharply, and bitcoin is trying to hold above 100K.

Next week's FOMC meeting should bring a new rate cut, but the market has been pricing this in so investors will be looking for clues from Powell to find out what's next on the agenda. The data has been showing sticky inflation and moving in the wrong direction and this week's pullback, besides being on the calendar, is the market realizing that, after next week, the Fed may be done cutting for a while - especially if the economic data remains good.

 

[tsptalk]

Stocks get off to a good start this week as the calendar turns more bullish (are you sick of hearing that yet?) but it could still remain choppy.

The on again, off again small caps are on this morning, leading the pack out of the starting gate.

Bitcoin is at 106K and investors are now in chase mode there. 110K looks like a price target in the short term based on the large 2024 bull flag. I'll post a chart later.

Yields are flat and overseas markets are trading lower. Oil and gold are down a bit.

This is all ahead of this week's FOMC meeting and likely rate cut. Recent Fed meeting have had big moves the day prior to the meetings for some reason, so the bulls shouldn't get too comfortable. The bears might make a move tomorrow, but the calendar does favor the bulls (He said it again! )

 

[tsptalk]

Bitcoin is at 106K and investors are now in chase mode there. 110K looks like a price target in the short term based on the large 2024 bull flag. I'll post a chart later.

The bull flag on bitcoin's chart was close to 105K, but because the length of the waving flag portion, it could move past that. That target is not a call for a top, but technicians are more likely to start taking profits at 110K plus.

 

[tsptalk]

Bitcoin made another new high this morning, but the stock market is unimpressed and we are seeing more selling in stocks.

I had a moment last night while writing my daily commentary, expressing some paranoid thoughts about this market with some strange divergences occurring. As I mentioned in that write-up, I don't have very good instincts for the market - it's almost all charts, indicators, stats and data, so there's no gut feeling or inside information. I'm just noticing some odd behavior.

That said I am still fully invested for now and haven't acted on this. My return (the TSP Talk Plus service) for the year is +30% and the greed in me wants to stay ahead of the S&P 500 for the year. But I am debating about how aggressive I want to remain into the end of the year given what we're seeing recently.

Today is shaping up to be the 9th straight loss for the Dow. Interesting timing. I understand that the top weighted stock coming into the month (UNH) is the drag on the index and their CEO was just killed, but the advance / decline data is hitting pre- 9/11 levels, and... well you can read it, here again today stocks are selling off.

It could be a good buying opportunity with Nvidia and other high flyers down more than 10% from their highs, or something nefarious is brewing. I'm not sure, but sometimes the market tries to give us clues.

The seasonality chart is choppy for this week (today is the 17th) so it's not unusual action as the official Santa Claus rally period is still a few days away. Then it gets very bullish, but nothing on this chart says 100% (blue lines.)

Chart provided courtesy of www.sentimentrader.com


Gold is down today, so no run to safety yet, but I wonder what congress is doing in their accounts this week.

The Fed is expected to cut interest rates 0.25% again tomorrow.

 

[robo]

The Fed is expected to cut interest rates 0.25% again tomorrow.

Market tops and the Fed rate cut cycle: Some are pretty sure it will be different this time.... Keep your eye on the inversion chart too.

 

[exnavyew]

Well I woke up OK and now you've bummed me out. lol.
That said I personally had a great November but so far in Dec I've given about
40% of it back.
And having used up both IFTs can only reduce my exposure.
I'll keep my hand in the fire until Jerome speaks and if the river
of red continues I'll cut my Dec losses.
With 20/20 hindsight (JFK don't go to Dallas!!!) I guess I should've
waited until Dec 23 lol.
Giddy up Santa!!

 

[robo]

exnavy,

You are not the only one Brother! Lots of folks have moved into stocks for the Santa rally...

 

[tsptalk]

It's a quiet morning before this afternoon's Fed decision on interest rates, and more importantly, their outlook on monetary policy going forward. The chances of a rate cut are near 100%.

Stocks are mixed but near flat, yields and the dollar are up, but nothing significant, although the dollar is getting close to its 2024 highs again.

Sit tight. The fireworks will start at 2 PM ET.