| TSP Talk | Market Comments | TSP Tracker | Premiums | Site Map | TSP Funds | Message Board | Returns |
|
| Today's Commentary | |
|
It's getting serious - support being tested Stock dropped again as the price of oil temporarily moved above $100 a barrel yesterday. The Dow gave up another 107-points but the losses were mixed among the other indices. For the TSP, the C-fund fell 0.61% yesterday, the S-fund dropped 1.42%, the I-fund actually added 0.20%, and the F-fund (bonds) slipped 0.06%. The S&P 500 was down a modest 0.61% but as you can see in the TSP share prices, the losses were much worse for small caps, and we saw gains in the I-fund as the dollar continued its slide. The S&P is now 111-points above the 200-day EMA, that's 38 points lower than on Friday. That's still high, but it is getting less extreme. The S&P also found at least temporary support at the lower longer-term ascending trading channel.  Chart provided courtesy of www.decisionpoint.com, analysis by TSP Talk It would be nice if that support would hold. Technical analysis does amaze me at times but if we can see this support line hold, it would be hard not to be a believer in the charts and technical analysis. That said, the 50-day EMA is about 15-points below that rising support line, and that would be the next target should the larger trading channel break. Speaking of technical analysis, the Nasdaq temporarily fell below the 50-day EMA yesterday, but managed to close back above it.  Chart provided courtesy of www.decisionpoint.com, analysis by TSP Talk The Dow Transportation Index got clobbered again as oil moved up sharply again, but take a look at where it closed: The index plummeted through the 50-day EMA and the January lows, but buyers stepped in and moved it back up and closed above those lows.  Chart provided courtesy of www.decisionpoint.com, analysis by TSP Talk The weak dollar gave the I-fund some relief. As we keep saying, if the dollar is falling, the I-fund should outperform the C and S funds. I didn't say the I-fund would be up if the dollar falls. It is just more likely to outperform the other two stock funds.  Chart provided courtesy of www.decisionpoint.com, analysis by TSP Talk If the early February lows are taken out, this will look very bad for the dollar. I raised a little more cash (G fund) yesterday going from 60% stocks to 50%. I'm still not convinced that this bull market is over, and I don't want to be completely out of stocks as fast moving markets will likely produce a few snap-back rallies regardless of the final outcome. Should we be seeing the start of a correction (10% or more) we should have opportunities to sell those rallies. I doubt the market will go straight down after the strength we've witnessed over the last three months. The charts will start to breakdown if the bull market is going to end and we are seeing the first signs of that, but it doesn't happen overnight. This market action is being influenced by a lot of emotional trading. The situation in the Middle East is a good reason for that emotion because the price of oil will directly affect many aspects of the market and the economy. That same emotion will trigger rallies if / when the news improves. Thanks for reading! We'll see you tomorrow. Tom Crowley
|
TSP Talk does not guarantee the
accuracy or completeness of this report, nor does TSPtalk.com assume any
liability for any loss that may result from reliance by any person upon any such
information or opinions. Such information and opinions are subject to change
without notice and are for general information only. The information
contained on this website is for educational purposes only and not intended to
be recommendations, and may not be published, broadcast, rewritten or otherwise
distributed without prior written consent from TSPtalk.com.
Buy Low Sell High, Inc.
TSPtalk.com® is a trademark of Buy Low Sell High, Inc.
All Rights Reserved
Buy Low Sell High, Inc., P.O. Box 13213, Ogden UT 84412