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| Today's Commentary (Short Term Outlook) |
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Back in the wedge Stocks rallied yesterday, ironically on a strong earnings report from Goldman Sachs, and other companies like Coca-Cola. The Dow was up 25-points, but the broader market actually did much better. For the TSP, the C-fund gained 0.81%, the S-fund jumped 1.35%, and the I-fund added 0.80%. The F-fund ticked up 0/01%. The S&P 500 has worked its way right back into that rising wedge formation, which is getting a little tight. I suspect we will find out in the next day or two which way this wedge is going to break as we have now seen a false breakout, and now a false breakdown.  Chart provided courtesy of www.decisionpoint.com, analysis by TSP Talk Volatility spiked during last Friday's sell off hitting 20.0 on the VIX. But almost as quickly as it shot up, it has now pulled back down under 16.0 and complacency is apparently back. The Goldman Sachs scare appears to be behind us but if the SEC starts giving more details or naming more target companies, things could stir up again volatility-wise.  Chart provided courtesy of www.decisionpoint.com, analysis by TSP Talk After the close yesterday, we had some mixed earnings reports. Apple's report was strong and traded higher in after hours trading, but Yahoo disappointed and traded down. The futures seem to be reacting positively as we are seeing modest gains in the S&P futures, and strong gains in the Nasdaq futures. We are also seeing decent overnight gains in Japan's Nikkei as I write this. It is getting tougher and tougher to come up with something to say each day about this market. The S&P 500 could shoot straight up from 1200 to 1500 and I could not really put any different spin on it than I am now. I find myself on the sidelines waiting for an opportunity to buy, and if it goes to 1500 without me, so be it. Just give us a 5% pullback and I'll have something to think about. Until then, I'll sit on the dock and watch this boat pull away, because I missed it and I don't want to put my account in the water in an attempt to swim to the boat. There might be sharks out there waiting for fresh meat. Thanks for reading. We'll see you back here tomorrow. Tom Crowley |