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The Bernanke Slide Stocks were looking to break a 4-day losing streak yesterday, and they were sailing along with the Dow up 80-points before the market started to do the Bernanke Slide late in the afternoon. By the close, the Dow had lost 19-points.  For the TSP, the C-fund lost 0.09% yesterday, the S-fund picked up 0.29%, the late decline in U.S. stocks allowed the I-fund to hold onto a 0.41% gain, and the F-fund (bonds) added 0.03%. Fed Chairman Ben Bernanke made a few key points yesterday afternoon, and none were all too inspiring. He talked about the obstacles the consumer is facing with higher food and energy costs. He mentioned housing prices dropping, yet tightening in mortgage underwriting has made it tough to get loans. He talked about the urgency of policymakers to consider budgetary concerns, but at the same time didn't want to hurt a fragile economy. Despite the negative spin, he did not offer any hints of a QE3 (quantitative easing) or other solution, and investors sold.
What looked like a relief rally, turned into a 5th consecutive negative day.
I suspect the selling yesterday was more emotional than anything else and I
would not be surprised if we had a good day today. Something tells me
is going to be either a really good day, or a really bad day. It seems
like Wednesdays have been quite wild over the last several months.  Chart provided courtesy of www.decisionpoint.com, analysis by TSP Talk The story remains the same: We have a market that is in a long-term bull market, in an intermediate-term break down, but it is oversold in the short-term time-frame, with overly bearish sentiment, which could lead to a strong relief rally. I'm in the mode of wanting to sell any rally unless the S&P 500 can move back above the 50-day EMA during that rally. Thanks for reading! We'll see you back here tomorrow. |
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