Nerves are showing

Stocks opened sharply lower yesterday, as we anticipated, because the futures were indicated deep losses all Sunday night and into the early Monday morning trading. 

We also suspected that we could see the dip buyers coming in and buying the emotional Monday morning open.  The Dow did recaptured about 100 of the early 150+ point loss before politics showed its ugly head again, and investors nervously backed off.

           
The press conferences from both political parties did nothing but tell us that they are as far away as ever from making a deal on the debt problem.  So, the uncertainty continues.

For the TSP, the C-fund lost 0.56% yesterday, the S-fund fell 1.04%, the I-fund was down 0.65%, and the F-fund (bonds) gave up 0.17%.

The S&P 500 remains in the same situation after a modest pullback from the overhead resistance.  The inverted head and shoulders pattern remains intact as the right shoulder (RS) continues to form.
                        
                        Chart provided courtesy of www.decisionpoint.com, analysis by TSP Talk

The indices are neither overbought nor oversold right now and are basically at the mercy of the folks in Washington.
                        
                       Chart provided courtesy of www.decisionpoint.com, analysis by TSP Talk

Because of this, there is little analysis to be done.  I do believe the market has a bullish bias because of the chart formations, but we may not see any significant bullish action until some kind of a deal is made in the debt negotiations.  Until then, staying defensive may be the best way to play this, but once a deal is made, the sidelines may not be the place you want to be.  I may gamble at some point this week.

Thanks for reading!   Well see you back here tomorrow.