Market Comments November 13, 2008 TSP Fund share prices as of: 11/12/08 Fund - G Fund F Fund C Fund S Fund I Fund 12.6867 12.0093 9.8031 11.1592 12.8746 $  Change - 0.0026 0.0523 -0.7655 -0.9851 -1.1818 % Chg day - +0.02% +0.44% -7.24% -8.11% -8.41% % Chg wk - +0.05% +0.73% -8.41% -10.34% -9.38% % Chg mon - +0.12% +2.29% -11.86% -14.96% -9.30% % Chg 2008 - +3.31% +0.66% -40.80% -43.61% -48.00%   L2040 L2030 L2020 L2010 L Income 11.5947 11.8034 12.1289 13.3650 12.4687 $  Change - -0.7801 -0.6896 -0.5866 -0.3158 -0.1887 % Chg day - -6.30% -5.52% -4.61% -2.31% -1.49% % Chg wk - -7.38% -6.47% -5.39% -2.68% -1.72% % Chg mon - -9.42%% -8.25% -6.81% -3.33% -2.12% % Chg 2008 - -36.43% -32.20% -27.15% -13.55% -7.43%

Today's Comments (Short Term Outlook)                             Printer friendly

If we're in a trading range... The Dow dropped another 400+ points yesterday and we are now looking at a two-day loss in the C-fund (S&P 500) of 7.2%.  That's an 8.4% loss for the week, and 11.9% for the month of November.  So much for a bounce off of October's lousy performance.  The rest of this week is going to be crucial as we have another test on our hands. If the market is going to remain in a trading range, then the brave investors would be looking to buy now since the S&P 500 is now at the bottom of that range.  The problem is that we have a triple bottom forming, and triple bottoms can act as support, but they are rare as they don't usually end up as triple bottoms.  They tend to break down.  But when they do hold, the rallies can be decent.                                   Chart provided courtesy of www.decisionpoint.com Not surprisingly, the NYSE overbought/oversold indicator has moved to -906, a level that is considered extremely oversold.  It is rare that we see readings lower than -1000, although we did see a reading under -1500 the day of the October 10th low.                                     Chart provided courtesy of www.decisionpoint.com You can see above that the -1000 level has been an area where we are likely to see at least some kind of bounce in the short-term.  We are not at -1000 yet, so this selling may not be quite over yet.  In October, the VIX hit readings rarely, if ever, seen before.  Last week when the VIX dropped into the 40's and hit the lower Bollinger Band (circled below) we anticipated another rebound in the indicator suggesting more volatility.  So far we have not been disappointed with that call.  The VIX is back in the mid-60's.  The question is whether we will see those huge 80-90 readings again.  That would surprise me, but it sure seems to be heading that way.  The upper Bollinger Band is currently at 80, and that could be the target.                                    Chart provided courtesy of www.decisionpoint.com After the bell yesterday, Intel came out with a "dire warning" and the stock tumbled more than 7 percent in after hours trading.  The company now expects sales to be closer to $9 billion instead of the $10.1 billion to $10.9 billion they had originally estimated. If there is any bright side to this story it is that sometimes guidance reports from Intel can be the exclamation point on the market direction.  If the market is moving higher and Intel gives positive guidance, the market tends to peak rather quickly before reversing down.  And when the market is moving down and Intel drops a bomb as they did yesterday, it sometimes indicates that a reversal is due.  But yesterday's new was really bad and may be an indication of what the market can expect during next quarter's earnings season. That's all for today.  Thanks for reading!  See you tomorrow.