tsptalk's Market Talk

[tsptalk]

Stocks are mixed and choppy this morning before this afternoon's Fed meeting and interest rate decision. Small caps are leading despite yields moving up, and the dollar is rising again potentially leading the I-fund to its 5th straight loss.

The dollar has been gapping up daily since the EU trade deal was announced, but here it is again at the 200-day average, and average that has proven to be stubborn.



The I-fund has fallen below 2 or 3 support areas and the 50-day EMA is looming near 60. It may all depend on whether the dollar stalls at that average or not.

Gold is down, oil and bitcoin are flat.

Microsoft and META report earnings after the closing bell today, and Apple and Amazon report after the close tomorrow.

We will get the July jobs report on Friday morning.

 

[tsptalk]

Microsoft and META are flying higher after hours.

 

[tsptalk]

The early action is dominated by the huge gains in Meta and Microsoft. The broader and smaller indices are not acting as well, but are holding up after a negative open. For example the Russell 2000 was up 0.01% last checked, and the NYSE is up just 0.5%.

But the S&P 500 (+0.80%) and Nasdaq (+1.27%) are up nicely and making new highs.

Yields are down despite a warm PCE Prices report, but that is helping the F-fund's BND to an early gain.

The dollar gapped up yet again and that has the I-fund's ACWX down about 0.40% in this very early trading.




Gold is up slightly, oil down slightly, and bitcoin is currently back over 118K.

 

[tsptalk]

It's uncanny. Every time I travel the market goes crazy.

How long did we go without a 1% day?

Sorry folks. This sell off is my fault.

Oh, wait. It's August 1st. This was suppose to happen.

 

[tsptalk]

The weaker than expected jobs report and the new tariffs are giving the market some fits, but it's right on cue (see prior post.)

Stocks are pulling back. Yields and the dollar are falling.






Gold is up sharply, oil is down sharply, and the cryptos are down.

Have a great weekend everybody!

 

[tsptalk]

Stocks sold off on Friday, as we all know, but several indices closed well off their lows creating positive reversal days. That usually means some follow up positive action in the short term, which is clearly what we're seeing this morning.

It looks like a heathy snap back rally but for now, the charts are filling in Friday's open gaps so there's more work to be done. Once those gaps are filled the traders may step aside and we'll have to see how investors react.

August isn't usually this accommodating to the bulls, especially after the market came into this month so overbought.

 

[rangerray]

Congratulations on the wedding and expanding your family!

 

[tsptalk]

Stocks are stalling but not before filling in Friday's open gaps in the indices. Both the C and S funds have hit some tough resistance so the easy money snap back rally that traders bought, now gets more difficult.

If the bears are serious, this is where they make their stand. If the bulls are going to take charge again, this is where they have to fight to regain that resistance.




Yields and the dollar are near flat. As is the ACWX (I-fund).

 

[tsptalk]

Stocks have been chopping around in a tight range in early trading. The indices are mixed with small caps lagging so far, and the I-fund leading as the dollar's straight up, straight down action continues this morning.



I'm a little surprised to see the tech heavy Nasdaq leading the big three indices with AMD getting hit hard.

The semiconductors are being hit hard, which makes more sense.




It's a slow week for economic data and historically it's a poor week for stocks so we'll see if the indices can stay afloat. So far so good after the dump and pump on Friday and Monday.

Gold, oil, and bitcoin are all relatively flat this morning.

 

[tsptalk]

Stocks have been chopping around in a tight range in early trading. The indices are mixed with small caps lagging so far, and the I-fund leading as the dollar's straight up, straight down action continues this morning.

Bouncing back. The 4% gain in Apple can really push all three major indices up. (S&P, Naz, Dow)

 

[nasa1974]

Bouncing back. The 4% gain in Apple can really push all three major indices up. (S&P, Naz, Dow)

View attachment 69857

Woo! Hoo! Go Apple. Except for Starbucks I'm all green.

 

[tsptalk]

Stocks are rallying this morning and it looks like the S&P 500 is trying to retrace last Friday's negative outside reversal (NOR) day candlestick. From there, whether it fully retraces it or not, it could rollover, or breakout. Both are valid moves, but that NOR breakdown day is a lure, however it often becomes resistance, so be careful.



There was a smaller and example of this in July of 2024 where there was an NOR, a retrace and actually a new high, then it rolled over. There was also a major NOR day on August 1 that led to a quick downdraft.

Yields and the dollar are near flat right now after the initial jobless claims were mixed to slightly weak.

At this point most are expecting that the Fed will be cutting in September and December, so it is basically priced in, but it means then money gets cheaper and the market could rally into the end of the year. If they don't cut, that will be a big problem for the market's psyche.

 

[tsptalk]

Stocks jumped out of the starting gate this morning and the S&P 500 quickly started to retest Thursday's highs. So far it is still retracing the previous Thursday's negative reversal breakdown candlestick. That's typical action, but whether that rolls over again after a test is the question. It has a bear flag angle to it, but it is starting to get too long to be a traditional bear flag.



Small caps are up but lagging again and remaining below resistance, and it could be because yields are moving up this morning. As I mentioned in today's commentary, the 10-year is closer to the bottom of its range making it vulnerable to a move back toward the middle or top of the range in the short-term.




Gold is on the move again. Oil and bitcoin are modestly lower.

Have a great weekend!

 

[tsptalk]

The early action on Monday is mixed and choppy. The S&P just dipped into negative territory after a positive open. The I-fund is lagging as the dollar is making a move higher, and small caps are flat.

The S&P is still retracing that July 31 candlestick, while the support below continues to hold.



Trouble in the Transports as this market leader is rolling over below support.

Gold is getting slammed with the dollar's strength. Bitcoin and crypto are up. Oil is flat.

Big week for inflation data with the CPI report coming out tomorrow, and the PPI on Wednesday.

 

[tsptalk]

We got the CPI data this morning and it is being scrutinized from every angle, but the bottom line is it was good enough to move the chances of a Fed rate cut in September up to 94%, and the stock market likes it.




The S&P is on the brink of testing the top of the negative reversal candle from July 31. The second chart shows the Transportation Index, which I had called one of my biggest concerns yesterday, is bouncing right back to test the 200-day average again. It's still looks like a bear flag, but today gives it some hope of moving back above resistance.



Interest rates are likely going down next month, yet the 10-year yield is up sharply this morning. Maybe the bond market isn't as impressed with the CPI as the stock market, or it's a buy the rumor sell the news reaction (bond prices go down when yields go up.)

 

[tsptalk]

My bad. I have been posting that the PPI data will be released today. They almost always come on back to back days, but not this week.

Correction! We'll get the PPI report (Producer Prices) on Thursday morning before the opening bell.

Sorry about that

 

[tsptalk]

Another gap up open to new highs for the S&P 500 this morning, but in the first hour of trading it is making an attempt to fill that gap.

The bulls have a lot on their side like momentum, chart patterns, lower interest rates and taxes coming, and tech growth.

The bears have the valuation situation on their side (hitting historical extremes), bearish seasonality (where is it?) and some negative divergences internally with the advance / decline numbers and the number of stocks above the 50 day average is well below typical new high levels.

As always...

“Markets can remain irrational longer than you can remain solvent.” - John Maynard Keynes

 

[tsptalk]

The Producer Price Index (PPI) came in hotter than expected and stocks are getting off to a sluggish start. It was a good excuse for a little selling, but maybe we just need a new person in charge of the pricing data.

The S&P loss is actually about where it was in the early overnight futures, and so far the initial opening weakness is being bought - but there's a long way to go today. The VIX is still below 15 so investors are yawning at the decline.

Small caps are taking the brunt of the hit as yields are popping higher. The dollar is also up so the I-fund's loss is a little more severe than the modest S&P 500 loss.



Crypto and gold are down this morning, while oil is up slightly.

 

[tsptalk]

Every time we see stocks open sluggishly, we wonder if this is the start of meaningful pullback, and at least recently, that has not been the case. This morning some of the stocks that have been leading the market in recent months, like PLTR or BMNR, are down and if these can't miss stocks start wobbling, it could start a chain reaction.

It's way too early to make that call this morning, but we can hope. I have raised quite a bit of cash in recent weeks and would love an opportunity to buy at lower prices. Unfortunately, market declines don't usually come when we want or expect them to, but rather they tend to blind side us, although you can try to prepare. It's just a difficult game to to time perfectly, but when it works it sure feels worth the trouble.

A big gain in UNH is keeping the Dow positive so far, while the broader indices are down modestly so far.

Retail sales came in mostly inline with estimates.

U of Michigan Consumer Sentiment came in lower than estimates.

 

[nasa1974]

The way the market started I thought we might end the week on a good note. I was wrong.