11/08/12
Stocks plummeted yesterday as "fiscal cliff" became the center of the post-election discussion, as in - can we avoid it? The Dow lost 313-points after gaining 133 the day before. One was a head fake, but which one?
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[TD]
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Daily TSP Funds Return[TABLE="width: 150"]
[TR]
[TD="align: right"] G-Fund:
[/TD]
[TD="align: right"] 0.0036%
[/TD]
[/TR]
[TR]
[TD="align: right"] F-fund:
[/TD]
[TD="align: right"] 0.32%
[/TD]
[/TR]
[TR]
[TD="align: right"] C-fund:
[/TD]
[TD="align: right"] -2.28%
[/TD]
[/TR]
[TR]
[TD="align: right"] S-fund:
[/TD]
[TD="align: right"] -2.24%
[/TD]
[/TR]
[TR]
[TD="align: right"] I-fund:
[/TD]
[TD="align: right"] -0.90%
[/TD]
[/TR]
[/TABLE]
[TABLE="align: center"]
[TR]
[TD="align: right"]
[/TD]
[/TR]
[/TABLE]
[/TD]
[/TR]
[/TABLE]
The S&P 500 broke down from the bear flag that we have been watching, after the index turned away from the 20 and 50-day EMA resistance.
Chart provided courtesy of www.decisionpoint.com, analysis by TSP Talk
The small caps remain in a distinct downtrend and it is now near the bottom of the trading channel and testing the 200-day EMA.
Chart provided courtesy of www.decisionpoint.com, analysis by TSP Talk
The Nasdaq fell below the 200-day EMA, and being a more volatile index, support and resistance levels are less reliable. Looking for a reason the 200-day EMA broke, we see that a small open gap from back in August needed to be filled, and now it has been.
Chart provided courtesy of www.decisionpoint.com, analysis by TSP Talk
The dollar has been holding onto recent gains and the UUP is now testing the 200-day EMA.
Chart provided courtesy of www.decisionpoint.com, analysis by TSP Talk
I believe I posted this chart, or something similar, a few weeks ago and it shows that volume on inverse ETF's, which are bets against the market, are making up a higher than normal percentage of the NYSE Composite Index.
Chart provided courtesy of www.sentimentrader.com
It's not an instant gratification indicator, but readings above 0.07 have seen some short-term bounces.
The yield on the 10-year T-note fell below the support of the triangle formation. That could be bad -- or actually good.
Chart provided courtesy of www.decisionpoint.com, analysis by TSP Talk
As some of you know, RevShark puts out a daily market commentary each afternoon and it is geared more toward general market action rather than timing the TSP (which his weekly report addresses.) One thing he does is try to react to what the market is doing, rather than try to anticipate what it is going to do.
You can save yourself some grief by doing this, but you will rarely ever pick a bottom or top that way. And since he is talking about his profession of trading, he doesn't have to deal with close of business prices, deadlines, and TSP limits like we do in our TSP accounts.
It's much safer to react than anticipate, but because of our TSP limitations, we have to try to be a little bit more anticipatory, otherwise we can miss big moves in the market. (For the record, RevShark is a little more anticipatory in his TSP account management than his daily trading.)
Bottom line, trying to catch a falling knife can get you hurt and cause big losses. But if you happen to catch it at the bottom, the reward will be larger gains. It's your choice and everyone's situation is different.
Thanks for reading! We'll see you back here tomorrow.
Tom Crowley
Posted daily at www.tsptalk.com/comments.html
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.
Stocks plummeted yesterday as "fiscal cliff" became the center of the post-election discussion, as in - can we avoid it? The Dow lost 313-points after gaining 133 the day before. One was a head fake, but which one?
[TABLE="align: center"]
[TR]
[TD]
[TD="align: center"]
Daily TSP Funds Return[TABLE="width: 150"]
[TR]
[TD="align: right"] G-Fund:
[/TD]
[TD="align: right"] 0.0036%
[/TD]
[/TR]
[TR]
[TD="align: right"] F-fund:
[/TD]
[TD="align: right"] 0.32%
[/TD]
[/TR]
[TR]
[TD="align: right"] C-fund:
[/TD]
[TD="align: right"] -2.28%
[/TD]
[/TR]
[TR]
[TD="align: right"] S-fund:
[/TD]
[TD="align: right"] -2.24%
[/TD]
[/TR]
[TR]
[TD="align: right"] I-fund:
[/TD]
[TD="align: right"] -0.90%
[/TD]
[/TR]
[/TABLE]
[TABLE="align: center"]
[TR]
[TD="align: right"]
[/TD]
[/TR]
[/TABLE]
[/TD]
[/TR]
[/TABLE]
The S&P 500 broke down from the bear flag that we have been watching, after the index turned away from the 20 and 50-day EMA resistance.
Chart provided courtesy of www.decisionpoint.com, analysis by TSP Talk
The small caps remain in a distinct downtrend and it is now near the bottom of the trading channel and testing the 200-day EMA.
Chart provided courtesy of www.decisionpoint.com, analysis by TSP Talk
The Nasdaq fell below the 200-day EMA, and being a more volatile index, support and resistance levels are less reliable. Looking for a reason the 200-day EMA broke, we see that a small open gap from back in August needed to be filled, and now it has been.
Chart provided courtesy of www.decisionpoint.com, analysis by TSP Talk
The dollar has been holding onto recent gains and the UUP is now testing the 200-day EMA.
Chart provided courtesy of www.decisionpoint.com, analysis by TSP Talk
I believe I posted this chart, or something similar, a few weeks ago and it shows that volume on inverse ETF's, which are bets against the market, are making up a higher than normal percentage of the NYSE Composite Index.
Chart provided courtesy of www.sentimentrader.com
It's not an instant gratification indicator, but readings above 0.07 have seen some short-term bounces.
The yield on the 10-year T-note fell below the support of the triangle formation. That could be bad -- or actually good.
Chart provided courtesy of www.decisionpoint.com, analysis by TSP Talk
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[TR]
[TD]
[/TD]
[TD]
[/TD]
[/TR]
[/TABLE]
The stock market would rather see yields move higher (and bond prices and the F-fund go lower) since bond prices tend to move counter to stock prices.[TR]
[TD]
A breakdown is normally a bad sign for a chart, but if you recall, these triangle formations tend to give us a fake out before seeing a breakout in the other direction. |
[TD]
[/TD]
[/TR]
[/TABLE]
As some of you know, RevShark puts out a daily market commentary each afternoon and it is geared more toward general market action rather than timing the TSP (which his weekly report addresses.) One thing he does is try to react to what the market is doing, rather than try to anticipate what it is going to do.
You can save yourself some grief by doing this, but you will rarely ever pick a bottom or top that way. And since he is talking about his profession of trading, he doesn't have to deal with close of business prices, deadlines, and TSP limits like we do in our TSP accounts.
It's much safer to react than anticipate, but because of our TSP limitations, we have to try to be a little bit more anticipatory, otherwise we can miss big moves in the market. (For the record, RevShark is a little more anticipatory in his TSP account management than his daily trading.)
Bottom line, trying to catch a falling knife can get you hurt and cause big losses. But if you happen to catch it at the bottom, the reward will be larger gains. It's your choice and everyone's situation is different.
Thanks for reading! We'll see you back here tomorrow.
Tom Crowley
Posted daily at www.tsptalk.com/comments.html
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.
