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| Today's Commentary (Short Term Outlook) |
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Stocks up, volume down Stocks rallied again yesterday, keeping the strong upward trend intact. The Dow gained 45-points and all of the major indices followed along. For the TSP funds, the C-fund gained 0.58%, while the S-fund and the I-fund were up 0.71%. Bonds were up slightly as the F-fund gained 0.03%. The S&P 500 has been consolidating the last few days on low volume, but is holding up well above the old resistance turned support, and the rising support line. We do have a negative divergence on the MACD, which one of the few negatives I can find these days.  Chart provided courtesy of www.decisionpoint.com, analysis by TSP Talk That said, the market is likely to do what we least expect. The surprise move would be a pullback right here, since everything looks so good. Here's a check list: Is the S&P 500 above the 20, 50, and 200-day EMA's? Check. Is the 20-day EMA is above the 50-day EMA? Check. Is the 50-day EMA above the 200-day EMA? Check. Is the S&P 500 above major support? Check. Is investor sentiment below overly bullishness? No. Is the market overbought? No. April trading begins on Thursday and taking a look at the April seasonality chart below shows us that the month is quite bullish. Even more so than March.  These charts are a bit dated, but it is 56 years worth of data so it is still useful. As you can see, April is one of the top months historically:   Chart provided courtesy of www.sentimentrader.com With everything looking so good, does that mean it is time for the market to fool us? It sure is tough to bet against this market but I have to admit that perhaps things are looking a little too good, if that is possible. Enjoy the ride, but don't take your guard down. Thanks for reading. We'll see you back here tomorrow! Tom Crowley |