TSP Talk Blog

10/01/12

Stocks slipped on Friday as the Dow gave up 49-points on the day. The indices closed close to the middle of their daily trading range as the Dow had been down triple digits during early trading, and managed to make it above the breakeven mark at one point during afternoon trading.

Daily TSP Funds Return G-Fund: 0.0107% F-fund: 0.02% C-fund: -0.45% S-fund: -0.38% I-fund: -1.64% More returns

The S&P 500 has created a small bear flag, which may be a short-term concern, but it is back above the 20-day EMA, and there is strong support in the 1425-1430 area.


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

The Nasdaq shows a small bear flag and needs a quick, strong up day to negate this formation.


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

The Dow Transportation Index is also in some trouble here.


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

I showed the long-term monthly chart of the Transports on Friday and how bullish that looks for the long-term, but the chart above is flirting with breaking down below support, while also making a negative looking flag formation. If you are planning on buying and not checking for 5 years, you may be OK to buy here, but the short-term needs some help quickly - and of course that could happen.

I expect October to be volatile based on this Friday's jobs report, the 3rd quarter earnings, and the quickly upcoming election. We could get a couple of buying and selling opportunities so don't stray too far from your TSP account.

The Semiconductor chart, one of the leading technical indices, put in a nice reversal day last week so we'll have to see how much of an upside follow-through this can give. The Nasdaq, and possibly the small caps, will be affected by the direction this chart takes.


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

The C-fund gained 2.57% in September, and here are the rest of the TSP funds' monthly returns:



There have been 27 times since 1928 when the S&P index gained more than 2% in September. Of those, the first week in October was positive 22 times, an 81% success rate, with a median return of +1.1%. The maximum decline during the first week averaged -0.7% compared to a maximum gain that averaged +1.7%. During a presidential election year, 6 out of 7 were positive. (source: sentimentrader.com)

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

Tom Crowley


Posted daily at TSP Talk Market Commentary

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