tsptalk's Market Talk

[tsptalk]

It's a slow start to the new week with stocks mixed but mostly flat although small caps are getting a bid.

The Jackson Hole Symposium is the highlight of the week, and it starts on Thursday. Central bankers will gather the save the world.

Oil and gold are flat. Bitcoin is down, and yields are up slightly pushing the F-fund (BND) into negative territory.

 

[tsptalk]

Some of the recent market leaders in AI have been lagging recently and that is now bleeding into the broader market.

The Dow is up because of an old stalwart company like Home Depot, while crypto and AI related stocks are struggling this morning. After the recent gains, this isn't serious yet, but a 200-point decline in the Nasdaq this morning may get some of the weaker bulls' attention.

By "weaker bulls" I mean the wanna be buy and holders who tend to run when they see trouble. Buying and holding isn't as easy when your account balance is falling.

The S&P may be trying to retrace the gains from the bullish candlestick on Aug 12, the CPI rally.



Bitcoin is down sharply again, gold and oil are down slightly, yields are down and the dollar is up.

 

[tsptalk]

Stocks are falling again and the indices are starting to test some very key support lines after breaking through others.

The S&P 500 is still in a congested area with no signs of breaking down, but if it falls any further - 6350 looks key, then the next wave of support is another 100 points lower. The PMO is suggesting lower lows coming, but the bulls have not been listening to warning signs.



Small caps are getting slammed again as the hot and cold small caps throw volatility at investors. 2320 looks very important here if 2340 breaks.

Yields are down, oil and gold are up, and bitcoin is flat.

 

[nasa1974]

Not looking to be a good day. We still have 5 hours to go so who knows for sure. Only three of my stocks are green this morning.

 

[tsptalk]

We came into Thursday following Wednesday's big positive reversal day, and that usually means a positive open the following day. That wasn't the case and stocks gapped open lower, but the early weakness was bought and the gap was quickly filled. It's moving fast and the S&P is still down modestly as we head into day one of the Jackson Hole Economic Symposium.

Yields were up on hawkish views from the Fed on inflation, but you can see that the 10-year yield is testing resistance again near the moving averages.



The dollar is also moving up and it is not a meaningless rally as it recaptured the neckline of the inverted head and shoulder pattern, so the slow development of a potential bottom in the dollar is still underway. There is an open gap all the way up near 27.8 and 27.9.

Bitcoin is down while gold and oil are flat.

 

[tsptalk]

Did the Fed say something? I couldn't tell.

 

[tsptalk]

Just like that, back to a near 90% chance of a rate cut next month.

 

[tsptalk]

Mike Santolli, "The market wants a rate cut, but it doesn't want to need it."

 

[nasa1974]

I spend the day at Cedar Point riding some coasters and the market went crazy. What happened?

 

[tsptalk]

Nothing changed except Powell sounded slightly more dovish. Not much more than that.

 

[tsptalk]

We have a counter move this morning from Friday's big moves - stocks are down, although mixed with the Nasdaq positive. Yields and the dollar are bouncing and retracing some of Friday's decline, gold is flat but cryptos are coming off Friday's big gains.

The monetary set up for stocks looks good, especially if interest rates are going to come down, but it's tough to get too excited about putting money to work in the stock market when we see charts like this...

 

[tsptalk]

There's no denying that the price action is good, and that is really all that matters at any given time. It could change in days or hours, but when at new highs, that is good price action.

The problem is folks like Goldman Sachs have a year end target on the S&P 500 of 6600. It closed on Friday at 6466. That's would be a 2% gain. Not very optimistic, especially with interest rates set to come down. What are they seeing?

 

[tsptalk]

Stocks opened lower but quickly battled back and the big three indices are hovering just over the flat line. The Dow just turned negative but small caps are leading with the S-fund' DWCPF Index showing a solid 0.70% gain in early trading.

Consumer Confidence came in slightly better than estimates, but Nvidia's earnings after the closing bell tomorrow is this week's highlight.

Trump's attempt to fire the Fed's Cook is causing a stir but the flat indices show the market isn't too worried about that.

“President Trump purported to fire me “for cause” when no cause exists under the law, and he has no authority to do so. I will not resign. I will continue to carry out my duties to help the American economy as I have been doing since 2022." - Lisa D. Cook, Member, Federal Reserve Board of Governors

 

[Zapple]

I increased my allocation to S fund yesterday in hopes of a little rally in the small caps. We'll see if they play a little catch up to the larger caps. I remain somewhat skeptical, but it's gonna happen at some point. Of course it could be now or five years from now. Who knows? The anticipation of lower rates shouldn't hurt.

 

[tsptalk]

Stocks are modestly higher this morning with small caps leading the way again, as investors await Nvidia's earnings after the closing bell today.

The S-fund (DWCPF) is back in that top narrow trading channel, something it was able to hold for most of July, but eventually it falls back to the bottom of the wider channel. The channels are rising so the bulls may be buying the dips until this strategy fails.



The dollar is rallying again putting a lot of pressure on the I-fund this morning. Getting back over 27.50 opens to door to another test of the 200-day average. It has been almost two months since this bottomed.



The ACWC (I-fund) fell through some support but the 20-day average is trying to catch it.

Oil and gold are flat. Bitcoin is up modestly after the recent sell off.

 

[tsptalk]

After reporting earnings last night, Nvidia's weakness has been muted in the indices while some economic data came in better than expected. Despite that data, yields and the dollar are down today helping the S and I-funds to lead in early trading today.

The S&P 500 (C-fund) made a new intraday high and it is hovering between the highs and lows of the day's range. As I pointed out in today's commentary, the PMO momentum indicator continues to show a negative divergence while the S&P rises. Not a deal breaker, but maybe a red flag.



Small caps have been leading the large caps and it is doing so again this morning as the stock market gets more comfortable with the fact that the Fed may start cutting interest rates next month.

Oil is down, and gold and bitcoin are up to start the day.

 

[tsptalk]

We have some weakness this morning in the stock market. The selling started overnight so it doesn't seem to PCE inflation data related. That data came in mostly inline with expectations and likely doesn't change the Fed's outlook on rate cuts.

The indices are pulling back from recent highs, just before a long holiday weekend. Pre-holiday reversal? Maybe. End of the month profit taking? Maybe.

It's a pretty stiff dip but nothing that would change the technical picture yet.



Oil and bitcoin are down. Gold is up.