tsptalk's Market Talk

[tsptalk]

The S&P 500 is stalling under the 50-day EMA, which isn't a great look, but not unusual to see it hold off there, perhaps until the next headline hits and it will either breakout or rollover. With 4 Magnificent 7 stocks reporting this week starting after the bell on Wednesday, and the important jobs report on Friday, we should have some answers by the end of the week if you're not into speculating.



The 10-year yields is down sharply but the dollar is up modestly. Small caps and the I-fund are currently flat. Oil and gold are down, and bitcoin is up a bit.

 

[tsptalk]

The very early action is dealing with both resistance and support as the S&P 500 trades between the 20 and 50-day moving averages again this week. I'm surprised how well behaved it has been to the 20-day average lately.




The low Q1 GDP is bringing fears of a recession back, but yields are actually flat to slightly higher so it appears that the bond market may have been reacting to this already with the recent sharp decline. Yields tend to move lower on weaker economic data.




The jobs report on Friday may be a better indication since Q1 GDP data is more rear-view mirror data. They've been making estimates for several months already.

This may just be the excuse for the S&P 500 to pullback from the 50-day EMA, which is typical on the way back up.

 

[tsptalk]

The stock market was off and running at the opening bell with Microsoft and Meta posting solid earnings after the closing bell last night. This rally is helping push the S&P 500 above the 50-day EMA and now its banging its head into the next resistance area - the 200-day EMA. This is normally a tough close in a bear market so if this is still some kind of bear market rally, the selling may resume, but so far there's no signs of that this morning.



The S-fund (DWCPF) is in the same situation, but it's the 50-day average here.

Apple and Amazon report after the bell today and their guidance may be more influenced by the tariffs than Microsoft and Meta.

Jobless claims were higher than expected making the rally in Yields and the dollar interesting, and it makes today's rally that much more impressive, although the I-fund is feeling some pressure from the strong dollar. Last I checked it was flat.




Mixed action in commodities with oil and bitcoin up, and gold down sharply.

The jobs report comes out tomorrow morning.

 

[tsptalk]

Optimistic trade news from China and a stronger than expected jobs report are helping stocks rally again today.

I was concerned about a strong jobs report ruining the chances of an interest rate cut at next week's FOMC meeting, and bond yields are up big on the news, but the market seems more interested this development with China on trade.

The C-fund (S&P 500) is testing the April 2nd gap again (that's where it closed before the April 3rd sell off) and it is trying to remain above its 200-day average.

The S-fund (DWCPF) is close behind in testing that gap and it is above its 50-day average this morning.

The I-fund (ACWX) blasted out to a new high with the dollar down on the news.

And the F-fund (BND) is breaking down with yields rising.

The market always seems to go a little further than you think possible. This market looks like its getting too risky and stretched in the short-term, but no one seems to be in the mood to sell yet.

 

[tsptalk]

 

[tsptalk]

The charts just keep cutting through resistance.

FOMO!!

 

[tsptalk]

I couldn't have been more wrong about the market preferring a weak jobs report, over a strong one, for interest rate cut purposes.

 

[tsptalk]

The 9-day winning streak for the S&P 500 is in jeopardy as it is off to a weak start on Monday morning. So far the damage has been contained above the 200-day average, which is trying to hold. The nice thing about the chart breaking through all of that resistance recently is that old resistance, once broken, may try to act as support. The 50-day average isn't far below if the 200-day fails.



Yields are up again, I suppose it is because of the jobs report still, but as I mentioned in today's commentary, the bond market isn't acting like it is preparing for a recession, although there are other reasons why yields might go up.

It's early. Let's see how the day develops. The indices are stretched but the bulls have the momentum.

Gold is up while Bitcoin and oil are down to start the day.

 

[nasa1974]

I guess a new winning streak will have to start over again.

 

[tsptalk]

The early action has the S&P 500 (C-fund) just barely breaking below its short-term rising channel and sitting on the 50-day average.



Small caps are keeping pace, also down 1% on the day as the S-fund (DWCPF) has fallen back below its 50-day average but clinging to the bottom of its channel in early trading.

Oil is jumping up $2 a barrel this morning, gold is also up, and bitcoin is flat to slightly lower.

We expected some kind of backing and filling but a retest of the lows was becoming less likely as the charts improved. Remaining above key support - some of which was old broken resistance, is important, but so is filling gaps or just retesting that support builds a base rather than getting a less stable parabolic move.

 

[tsptalk]

We got a pop at the open that started last night when we got word that U.S. Treasury Secretary Scott Bessent and top trade official Jamieson Greer would be meeting with their Chinese counterparts on Saturday in Switzerland to talk trade.

It's also an FOMC day with the Fed speaking later this afternoon, so investors are treading lightly, the indices have backed off their highs and the Nasdaq just went negative.

Yields are down and the dollar is up slightly, otherwise there's a lot of nothing going on.

Oil and gold are down, and bitcoin is rallying.

The Fed monetary policy should be released about 2PM ET.

 

[tsptalk]

Stocks are rallying this morning after the US and UK make a deal on trade and tariffs.

The action has reminded me a lot of the 2020 covid market bottom when good and bad news was constantly being thrown at us. In the case of covid it was about the Fed and government stimulus money. This time it's all about trade, but the charts look quite similar.

That could mean more consolidation in the coming days / weeks while the market digests this initial launch off the lows, but what happened next after May in 2020?



It wasn't too bad. But again, stimulus and 0% interest rates helped in 2020.



Gold is down, oil is up, and bitcoin is flirting with 100,000 again.

 

[rangerray]

I’m sort of in the camp that thinks a rate cut would kill a rally because it might signal the economy is in trouble.


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[weatherweenie]

I’m sort of in the camp that thinks a rate cut would kill a rally because it might signal the economy is in trouble.


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That's why I don't understand the clamor for a rate cut. Rates go down when the economy is bad.

 

[tsptalk]

Agree. Stable rates are more important, but lower rates will help earnings, especially to smaller companies, and more than likely, the stock market.

 

[tsptalk]

Stocks are stalling at resistance, but not backing off yet and the indices are fairly flat in early trading. The charts may be suggesting a lull in the trade talks, and it may take another deal or two to get the resistance taken out.



Yields and the dollar are down and the weak dollar is lifting the I-fund this morning.

Gold, oil, and bitcoin are all up.

 

[tsptalk]

Big gains across the board this morning following the weekend trade deal with China. We have large open gaps on many of the charts, which is good (big gains), and bad - since they often get filled.

Let's look at some of the moves.

The S-fund's DWCPF jumped above some key moving averages and the top of the rising trading channel.

The Dow Transportation Index had been languishing in a bear flag below support. Pop!

Yields and the dollar are up. The 10-year Treasury Yield is now above a trading range and potentially concerning if the trend changes to up.



The dollar is also rallying and it is now above its 50-day average and the descending resistance line, but still below the 200-day. The I-fund is up this morning, but lagging the US funds by quite a bit because of that dollar strength.

Monday gaps are not always trustworthy. So far so good, but there's a lot of trading left in the day.

 

[tsptalk]

Stocks are mixed but mostly higher again, although the Dow is down because of UnitedHealth Group, the 3rd largest weighted stock in the Dow, is down 14%.

Otherwise, Tuesday is starting with some piling on as the underinvested are catching up. At some point these gains will cause some consolidation and backing and filling, but so far not this morning.

For those not in stocks, they are facing the age old question of whether to chase or be patient. Was it a gap and go, or will the gaps get filled?

The tendency is for it to get filled, but not always when it gaps on a major shift in economic policy.

Yields are up despite the cool inflation data, mostly because the bond market is pricing in better growth. the dollar is down digesting its big gains from Monday.

Oil, Gold, and Bitcoin are all up this morning.

 

[tsptalk]

The stock market can use a quiet day and so far this morning, it is getting one. The S&P 500 is flat in early trading, small caps are down, and but the Nasdaq is doing well in early trading.

The I-fund is also doing well with the dollar still in the process if filling in Monday's open gap.



The 10-year yield is up a tick. Oil, gold, and bitcoin are all down this morning.

So, we'll take a quiet day, but tomorrow we'll get the PPI data and things may get more interesting.

 

[tsptalk]

Stocks opened lower but dip buyers have shown up in the second hour of trading to take the Dow and S&P back into positive territory.

There's a long way to go in the trading day and the battle will continue between profit takers and those dip buyers. A little sideways action wouldn't hurt anybody at this point.

Bond yields have fallen sharply on the weaker than expected PPI report, helping the F-fund to a nice start this morning.

Tech stocks in the Nasdaq are lagging, but certainly due for a break.




Gold is up and Oil is down sharply after hitting the resistance of the 200-day EMA.