TSP Talk - Thrift Savings Plan Strategies

Market Comments

May 28, 2010

Current TSP Share Prices

Today's Commentary (Short Term Outlook)                                   Printer friendly

Relief

Stocks rallied out of the gate on Thursday morning and, after several days of early weakness / late strength or early strength / late weakness, the market was able to hold onto and add to, the early gains into the close, as the the Dow ended the day up 285-points.



The TSP stock funds soared. The C-fund gained 3.33%, and it was the laggard. The S-fund jumped 4.2%, and the I fund picked up an amazing 4.88%. The F-fund slipped 0.39% as investors chose stocks over bonds.

The S&P 500 broke through some short-term resistance as it rallied up to the 200-day EMA. As we have been saying, the overhead resistance has become heavy and volatility will likely persist and keep us from feeling confident about a rebound, despite the classic reversal set up.


                     Chart provided courtesy of www.decisionpoint.com, analysis by TSP Talk

We have many indications that this could be the real deal, and may be the start of a decent rally, but the low pre-holiday volume gives us a little pause. Some follow-through today would help, but I will be interested to see what happens on Tuesday as many times pre-holiday action is reversed after a long holiday weekend.

                     Chart provided courtesy of www.decisionpoint.com, analysis by TSP Talk

The NYSE overbought / oversold indicator is back over the neutral mark and up against that descending resistance line. Another obstacle in the way and a test of the strength of this potential market rebound.

                     Chart provided courtesy of www.decisionpoint.com, analysis by TSP Talk

On the bright side, put/call ratio sentiment is still quite bearish from the "dumb money", which should be bullish for stocks. At the same time the "smart money" put/call ratio is much more bullish (which is also bullish). Dumb money = contrarian indicator.

                     Chart provided courtesy of www.decisionpoint.com, analysis by TSP Talk
Nothing is easy in this game and I am certain the market will do everything possible to try to make us lean the wrong way. We have a nice set up for a continued rallied, but we will more than likely see some ugly days in the near future, just to keep us guessing.

Thanks for reading.   I will be going out of town for the weekend starting this morning so I may not be checking my email until later this afternoon or evening. Also, I won't be posting a Weekly Wrap-Up this weekend. My brain needs some down time.

Have a great Memorial Day weekend!

Remember Those Who Served

Tom Crowley

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