TSP Talk Blog

Stocks opened the day down as we saw some early "sell the news" reaction, but buyers were right there to pick up the discarded shares, and the indices moved from the bottom left on the chart, to the top right. The Dow lost 2-points but had been over 140-points in early trading after some big name Dow stocks reported disappointing earnings.

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Bonds (F-fund) rallied for a second straight day on relief of no default, but yields are sinking as if these bond traders are concerned about growth in America. Could be why stocks are rising. It's the only game in town that's paying.

The S&P 500 (SPY) has moved sharply higher since the reversal and bottom last week, and is now making new highs. There is some intermediate-term resistance overhead, and we could be a little extended here, but the chart looks very nice. Trend traders are happy to be on the long side, making lots of money as they have been for most of this year, while many market timers are starting to call for a top.


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

The longer-term chart shows that the overhead resistance could be something to be reckoned with.


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

The Nasdaq is adding to its yearly highs but it is now dealing with that overhead resistance, so perhaps the leader will tell us what the rest of the market indices are going to do when they hit that resistance.


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

As mentioned above, bonds were up nicely yesterday, continuing to celebrate the debt deal.


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

The yields are dropping which could be an indication that bond traders are expecting the economy to slow down from here. But of course, the flag formations on all of these bond charts gave us clues that this was a good possibility.


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

The September Jobs Report, which was postponed because of the government shutdown, will be released next Tuesday, October 22. The reporting date of the November Jobs Report was moved from November 1 to November 8.

Thanks for reading! Have a great weekend!

Tom Crowley


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