TSP Talk Blog

Stocks blasted off out of the gate on Thursday morning and the Dow was up about 225-points. The indices then leveled off but by at about 1 PM ET, the price of oil started to drop again, and stocks lost a large chunk of their gains by the close. The Dow ended the day up a solid 63-points, but well off the highs creating a negative reversal day.

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The I-fund lost ground but it was due to payback some of the "extra" gains it was given on Wednesday. Bonds were down slightly

The SPY (S&P 500 / C-fund) was having a big day on Thursday until the price of oil started tanking again. The S&P 500 index closed about 20-points, or 1%, off its intraday high. That's a negative reversal that is at least short-term bearish to start out on Friday. The resemblance of the September peak is continuing, but I don't see it ended as badly as it did in October.


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

The Wilshire 4500 (S-fund) was not spared the big negative reversal. The overhead resistance has held and we appear to be seeing the right shoulder of an inverted head and shoulders forming. That's actually very bullish news because once the shoulder hits its lows, inverted head and shoulders patterns tend to break to the upside once they are completed. As we've seen, these take a long time to form, but the reward should come in the coming months for the bulls.


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

The price of oil fell lost another 3.4% yesterday and fell below $60 for the first time in over 5-years. The concern over weakening global demand has investors worried about the economic picture.


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

The EFA (EAFE Index / I-fund) was down slightly, but as we mentioned above, the I-fund took a bigger hit because of the price it was given on Wednesday was too high. There's not much good to say about this chart except that it may be a descending inverted head and shoulders pattern and may just be forming the right shoulder which may not be too steep. That's a lot of "mays." It's in a bear market so we should anticipate bearish results.


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

The AGG (Bonds / F-fund) were down slightly on Thursday but closed off the lows having moved counter to the reversal in the stock market.


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

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Thanks for reading! Have a great weekend!

Tom Crowley


Posted daily at TSP Talk Market Commentary

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