Today's Comments (Short Term Outlook)

Stocks rally on another vote of confidence Like the big rally we saw earlier in the week, which was triggered by positive comments from Meredith Whitney, yesterday's late rally in stocks came after some positive comments from Nouriel Roubini.  Both were very bearish on financial stocks in 2008, and now both have backed off their negative stance.  The TSP stock funds were up 0.6% to 1.3% by the close. Unless something very dramatic happens today, the S&P 500 should have its first positive week since the week of June 8.  Resistance is just overhead as it continues to test the head of the head and shoulders pattern, and once again, the 200-day moving average.  Volume has been average at best, although today is options expiration day and we should get a little more activity, however, the action could be deceiving.                        Chart provided courtesy of www.decisionpoint.com, analysis by TSP Talk The Dow Transportation Index has been lagging and is again nearing a critical resistance area. It has now been up seven days in a row and this is the fourth time the Transports have knocked on the door of the 200-day EMA.  Usually if you keep a knock'in, eventually someone will let you in, so we will be on the lookout for an important breakout in this index.                   Chart provided courtesy of www.decisionpoint.com, analysis by TSP Talk The TSP Talk Sentiment Survey came in this week at 46% bulls, 44% bears for 1.05 to 1 bulls to bears ratio.  Our system still has us officially in a bear market and that means anything over 1.0 to 1 keeps the system on a sell signal.  If we were instead in a new bull market, it would not be a sell signal.  Where do you think we are - A bull market, or bear? Next week is post options expiration week, and historically it tends to be weaker than an average week.  The seasonality chart below sort of confirms this for this month as Monday will be the 13th trading day in July... That's all for today.  Thanks for reading!  Have a great weekend!