Stocks rallied modestly yesterday with the Dow picking up its first gain after 7 straight down days. A late rally was responsible for most of the gains and the indices closed at their highs of he day, which is generally bullish and what you might expect to see on a positive day in a bull market. The small caps led and the I-fund was held back by a strong dollar.
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The July Jobs Report comes out on Friday morning and the consensus estimates are looking for a gain of 185,000 jobs and an unemployment rate of 4.8%. The Jobs Report Contest is now open in the forum. Click here for more info.
The S&P 500 (C-Fund) bounced off the 20-day EMA and is comfortably back within the flag formation. The bears failed to follow up with selling as it seems the dip buyers were not going to wait too long, but it's a little too early for the bulls to claim victory. I don't always trust the 20-day EMA so it's more about the flag holding for me. Another test of the bottom of the flag is always possible and it needs to hold or the bears may get interested again.
The PMO just crossed below the moving average which tends to be a sign of weakness, bit not always on the first cross...
I have noticed over the years that the first crossing of the PMO below its moving average tends to trigger an oversold bounce reaction. It's the second crossing that tends to initiate some kind of peak.
The DWCPF (S-fund) bounced sharply off the 20-day EMA but remains below the old support line of the "F" flag. It still hasn't filled that small gap so we have to keep looking over our shoulders for that possibility.
The Dow Transportation Index saw a modest rebound after Tuesday's big sell-off. It looks like it needs to get back above 7750 to clear the old support, which could now act as resistance.
The EFA (I-fund) was down early yesterday but hit and rebounded off the 200-day EMA, closing at the highs of the day, but still closed with a loss. Technically, this chart is still fine.
The HYG High Yield Bond Fund also reversed higher so for those who take their keys off of this important Fund, so far so good. The pullback looks healthy at this point, as long as it remains in the channel and above the 50-day EMA, without creating a lower high in the process.
The price of oil reversed midday and closed with a 3.3% gain. The action might be considered a positive outside reversal day, although closing above yesterday's high would have been better. This chart is broken and any bounce is suspect, but as long as it remains above $40 the impact on stocks shouldn't be too bad.
The AGG (Bonds / F-fund) posted a nice positive reversal day but it is now running into the old support line of that flag formation. Once again bonds were up and stocks were up so the atypical non-divergence continues.
Read more in today's TSP Talk Plus Report. We post more charts, indicators and analysis, plus discuss the allocations of the TSP and ETF Systems. For more information on how to gain access and a list of the benefits of being a subscriber, please go to: www.tsptalk.com/plus.php
Thanks for reading. We'll see you back here tomorrow.
Tom Crowley
Posted daily at www.tsptalk.com/comments.php
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.
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Earnings season is winding down so Friday's jobs report becomes the main focus as investors look for clues on interest rates, although most now feel we won't see any changes - at least until after the election. But the BOE (Bank of England) has a decision on rates today and that could shake things up because they are expecting a rate cut.The July Jobs Report comes out on Friday morning and the consensus estimates are looking for a gain of 185,000 jobs and an unemployment rate of 4.8%. The Jobs Report Contest is now open in the forum. Click here for more info.
The S&P 500 (C-Fund) bounced off the 20-day EMA and is comfortably back within the flag formation. The bears failed to follow up with selling as it seems the dip buyers were not going to wait too long, but it's a little too early for the bulls to claim victory. I don't always trust the 20-day EMA so it's more about the flag holding for me. Another test of the bottom of the flag is always possible and it needs to hold or the bears may get interested again.
The PMO just crossed below the moving average which tends to be a sign of weakness, bit not always on the first cross...
I have noticed over the years that the first crossing of the PMO below its moving average tends to trigger an oversold bounce reaction. It's the second crossing that tends to initiate some kind of peak.
The DWCPF (S-fund) bounced sharply off the 20-day EMA but remains below the old support line of the "F" flag. It still hasn't filled that small gap so we have to keep looking over our shoulders for that possibility.
The Dow Transportation Index saw a modest rebound after Tuesday's big sell-off. It looks like it needs to get back above 7750 to clear the old support, which could now act as resistance.
The EFA (I-fund) was down early yesterday but hit and rebounded off the 200-day EMA, closing at the highs of the day, but still closed with a loss. Technically, this chart is still fine.
The HYG High Yield Bond Fund also reversed higher so for those who take their keys off of this important Fund, so far so good. The pullback looks healthy at this point, as long as it remains in the channel and above the 50-day EMA, without creating a lower high in the process.
The price of oil reversed midday and closed with a 3.3% gain. The action might be considered a positive outside reversal day, although closing above yesterday's high would have been better. This chart is broken and any bounce is suspect, but as long as it remains above $40 the impact on stocks shouldn't be too bad.
The AGG (Bonds / F-fund) posted a nice positive reversal day but it is now running into the old support line of that flag formation. Once again bonds were up and stocks were up so the atypical non-divergence continues.
Read more in today's TSP Talk Plus Report. We post more charts, indicators and analysis, plus discuss the allocations of the TSP and ETF Systems. For more information on how to gain access and a list of the benefits of being a subscriber, please go to: www.tsptalk.com/plus.php
Thanks for reading. We'll see you back here tomorrow.
Tom Crowley
Posted daily at www.tsptalk.com/comments.php
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.
