Today's Comments (Short Term Outlook)                             Printer friendly

It's not just oil Stocks rebounded modestly Wednesday after Tuesday's selling.  We are trying to determine if the recent rally can hold up or if stocks will rollover again.  The good new is, the NYSE is no longer overbought and we have been seeing pretty good earnings so far.  Some of the guidance in those reports have been concerning, but for most part earnings have not been the big problem.  The problem could be prices.  That is, the prices that you and I pay for our everyday goods. We all know the story with oil.  It has been flirting with $120 a barrel and that is obviously affecting us all, whether you drive or not.                           Chart provided courtesy of www.decisionpoint.com - with analysis by TSP Talk The price of corn has nearly doubled since last summer.  Wheat has pulled back recently but is still double the price it was just a few months ago. Rice, of all things, is now being rationed by some stores, after the price has more than doubled since the summer of 2007. Winter is over but natural gas has also doubled in the last 6 to 8 months.  What does this mean?  It simply means we are paying more money for things we use everyday.  That takes cash out of our pockets and that will have an affect on consumer spending and the economy.  At the same time, housing is still suffering and the chart is showing some signs of rolling over again as a bearish head and shoulders pattern has formed.  If it breaks below the neckline we could see a test of the March lows.  The 200-day moving average was too much for it to overcome.                           Chart provided courtesy of www.decisionpoint.com - with analysis by TSP Talk I am writing this as much for myself as anything as the thinking out loud might help me to come to some conclusion on what the market has in store for us next.  The market does like to climb a wall of worry and perhaps that is what we'll see.  The key could be what the forward earnings will be like, which is why guidance is so important.  Apple's report yesterday was very good, but they are vulnerable to slowing consumer spending in the United States, and that the type of thing investors are worried about.  The stock was down slightly after hours last night, even though they beat the estimates handily.  It's the guidance! It's the same story for online retailer Amazon.  They beat estimates but lowered their outlook for operating income for the full year.  It's not - what have you done?  It's - what are you going to do?  That's all for today.  Thanks for reading!  See you tomorrow. Have questions?  Visit our message board for answers.  Would you like to be on our email alert list?  We will send you an email when there is a change to our asset allocation or market outlook.  Your email address will never be given out.  Read our privacy policy.  By signing up you agree to the TSP Talk Terms of Service.  More details below **. Are you bullish or bearish?  Join the Weekly Sentiment Survey. Like what you're reading?  Tell a Friend about us. ------------------------------------------------------------------------------------------------------------------- ** By joining our email alert list you will receive an email each time we initiate a transfer or change our market outlook.  You may also receive an email each Monday morning reminding you that our comments are updated daily.  We will always send out these emails prior to making the transfer myself but we can not guarantee you will receive it in time to make a transferide to follow our transfers in your own account, you do so at your own risk.  There is always a possibility for a loss in your account.  These transfers could come very often and you may have to act quickly to make the deadline.  Please consider your investment strategy before taking any advice or making any transactions.  By reading the contents of TSP Talk.com and accepting the email alerts, you must agree to the Terms of Service.  Thank you. TSP Talk