TSP Talk Blog

I hope everyone is enjoying their holiday weekend. We headed into the short week knowing that the there was a positive bias the week leading up the the 4th of July holiday, and stocks did not disappoint. We saw solid gains in the TSP stock funds while bonds pulled back. But pre-holiday trading can some times be reversed after the holiday and as we head into the 2nd quarter earnings season next week, those earnings will have to justify the recent the 10 - 12 week rally in stocks. It would be a surprise to see a "sell the news" reaction to either positive or disappointing earning.



Here are the weekly, monthly, and annual TSP fund returns for the week ending July 3:



We start the second half of 2014 with solid gains. If the second half can match the performance of the first half, we'd be looking at gains in the +13% to +17% for the year. We wouldn't complain about that. Even bonds would return over 7%. The G-fund tells us why stocks may keep doing well. You just can't make any money sitting in cash accumulating the current low interest rates.

The SPY (S&P 500 / C-fund) made new highs again on Thursday as it appeared the bears headed to the beach a few days early last week and not surprising, volume was below average. The SPY is trading right in the middle of a rising parallel trading channel (reddish) and Friday's action pushed it through some rising resistance (blue) and that breakout could be tested this coming week.


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


The small caps of the Wilshire 4500 (S-fund) have held up well after the breakout above the March highs. I personally didn't think that breakout would hold without more consolidation first, but the pre-holiday bullish bias held it above the 1040 area without much of a problem.


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


Bonds have pulled back while stocks moved higher. The IEF bond ETF chart shows that the lows on Thursday tested the prior low and held, but it is now below the 50-day EMA and at risk of creating a new downtrend, which would of course be bearish for the F-fund.


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


Good luck and thanks for reading! We will be back here next week with another TSP Wrap Up. You can read our daily market commentary at TSP Talk Market Commentary. If you need some help deciding what to do with your account, perhaps one of our premium services can help.

Tom Crowley
www.tsptalk.com
Weekly Wrap-Ups Archive
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The legal stuff: This information is for educational purposes only! This is not advice or are commendation. We do not give investment advice. Do not act on this data. Do not buy, sell or trade the funds mentioned herein based on this information. We may trade these funds differently than discussed above. We use additional methods and strategies to determine fund positions.