View RSS Feed

TSP Talk Blog

Start the 2nd quarter

Rate this Entry
4/02/12

Stocks rallied on Friday as the bounce off of Thursday's reversal day low, followed through. The Dow did gain 66-points, but not all of the major indices closed in positive territory.


For the TSP, the C-fund was up 0.37% on Friday, the S-fund was flat, the I-fund gained 0.70%, and the F-fund (bonds) lost 0.57%.

For the weekly and monthly TSP returns, please see our recent TSP Weekly Wrap-Up.

Here is what the major indices did on Friday, the final day of the first quarter... The symbols are in the order of: Dow, S&P 500, Transportation index, Nasdaq, Wilshire 4500 (small caps.)



The S&P 500 bounced cleanly off of the 20-day EMA on Thursday before rebounding and continuing higher on Friday. The overnight futures are up again as I write this Sunday night.


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

Buy and hold has been the best strategy this year and as long as this rising trend remains intact, that may remain the case. I have tried 3 times this year to sell to try to buy in at a lower price and I would have been better off just holding each time. Someday that won't be the case, but while this trend is holding it seems more of a gamble to sell.

Bonds dropped sharply on Friday as the yield on the 10-year T-Note rallied and may have broken above the falling wedge and bull flag patterns. Both would be bullish for yields, should it hold, and that would be bearish for bonds and the F-fund. It may be too early to say since the yield is still trading below the 200-day EMA.



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


The open gaps have not been completely filled in the yield chart, although the large one came very close. If I had to guess, I would say these gaps will get filled.

I touched on this in the weekly wrap up and it comes from sentimenTrader.com:

They said that large, commercial hedgers have been buying heavily into the bond market again. This is considered "smart money", so perhaps bonds are not ready to rollover.

They said: "... similar extremes [as we are seeing now] resulted in at least multi-week rallies in bonds. If we see a continued erosion in prices in the weeks ahead, it suggests a definite change in tone from most of the past 15 years.


Chart provided courtesy of www.sentimentrader.com


A quick check on oil shows that the big bull flag is being tested on the lower side of the flag again. We could either see a break down in oil if the flag breaks, or a bounce back into the flag. Clearly, this could be a big decisive week for the future price of oil.


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


The 50-day EMA was broke on Friday and that could act as resistance on the way up, but I believe the bull flag's support may be stronger. We'll see.

This week's economic report schedule looks busy, and despite the stock market being closed on Friday, the schedule says we will get the March jobs report that day. Early estimates are looking for a gain of 200,000 non-farm payroll jobs, and an unemployment rate of 8.3%.

Thanks for reading! We'll see you tomorrow.

Tom Crowley


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.

Submit "Start the 2nd quarter" to Digg Submit "Start the 2nd quarter" to del.icio.us Submit "Start the 2nd quarter" to StumbleUpon Submit "Start the 2nd quarter" to Google

Comments


S&P500 (C Fund) (delayed)

(Stockcharts.com Real-time)
DWCPF (S Fund) (delayed)

(Stockcharts.com Real-time)
EFA (I Fund) (delayed)

(Stockcharts.com Real-time)
BND (F Fund) (delayed)

(Stockcharts.com Real-time)

Yahoo Finance Realtime TSP Fund Tracking Index Quotes