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Dip buyers show up

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Stocks were mixed on Tuesday with the Dow gaining 60-points, the S&P 500 up modestly, the small caps were basically flat, while the Nasdaq and Tranports were down. But all of them finished well off the lows and turned a negative reversal day on Monday, into a positive reversal day on Tuesday.


Daily TSP Funds Return

The I-fund was the big winner again, and it has continued to lead in 2015. Bonds were up but closed near their lows.

The negative reversal day on Monday did turn into more short-term downside for the SPY (S&P 500 / C-fund) early Tuesday morning as we'd expect, but the dip buyers stepped up again and it finished near the highs of the day creating a positive reversal day. That doesn't mean today will be a positive day, but the momentum is up going into the day's trading.


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


The Wilshire 4500 (S-fund) created a big positive kangaroo tail reversal yesterday, and we've seen a lot of these tails recently, although not always in the same direction. Any upside action today would be another test of the March highs.


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


The Dow Transportation Index has been lagging and was flirting with breaking down a week or so ago, but yesterday's positive reversal looks very strong as it bounced off the 200-day EMA and the prior lows. It's not out of the woods yet and would need to get above the 50-day EMA and yesterday's high before it looks good technically, but it does look like it is trying to make a "W" bottom - actually it would be more of a triple bottom if it held.


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


The
EFA (EAFE Index / I-fund) had formed a bull flag and it looks like it wants to break to the upside of the flag without any regard for the open gaps below.


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


The reason the I-fund is doing so well is because the big markets in Europe, which are living on QE, are all near new highs.

The AGG (Bonds / F-fund) rallied early but turned down as stocks started to rally. There was an open gap created with the strong open, but it ended the day with a negative reversal day.


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



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Thanks for reading! We'll see you back here tomorrow.

Tom Crowley



Posted daily at TSP Talk Market Commentary

The legal stuff: This information is for educational purposes only! This is not advice or a recommendation. 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.

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Comments

  1. userque's Avatar
    Thanks Tom.

    If anyone is wondering what 'QE' is:

    [url]https://en.wikipedia.org/wiki/Quantitative_easing[/url]
  2. James48843's Avatar
    dip buyers seem to have vanished on disappointing GE earnings.

S&P500 (C Fund) (delayed)

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DWCPF (S Fund) (delayed)

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EFA (I Fund) (delayed)

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BND (F Fund) (delayed)

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