TSP Talk Blog

Every time we think this market is about to crack, the dip buyers show their persistence and jump on the bargains while most of the less "convinced" investors are running away. But the upside breakout has been elusive of late as the market remains range bound.

On Friday the Dow gained 184-points, recouping nearly of the losses incurred on Thursday. The S&P gained back all and then some, but small caps have been slumping and still have some work to do to get Thursday's losses back.

Daily TSP Funds Return More returns

I posted this in the forum regarding the I-fund on Friday, but for those who don't go there...

I'm getting a lot of inquiries about the price given to the I-fund yesterday. A few things to keep in mind:

1) The EAFE Index that the I-fund tracks closes before noon ET.

2) The EFA price at the bottom of tsptalk.com is NOT the I-fund. It is an ETF traded on the U.S. market that is supposed to track the EAFE Index and so we use it for some intraday guidance, but since it is traded like a stock, the price is where the buyers and sellers agree on a price. So while the EAFE is closed, traders are still speculating on a price.

3) The TSP has to come up with a price. This where it gets tricky because they have to decide whether to use the actual EAFE number, or to add / subtract "fair value" based on what's happen in other markets after the EAFE has closed.

The I-fund was given a loss of 0.27% on Friday.

The EFA had a gain of 1.11%.

The EAFE Index actually closed down 0.28% on Friday.



https://www.msci.com/end-of-day-data-search


The EAFE and the TSP will likely adjust on Monday, you'll see.

More on "fair value"... What is a "FV" and how does it work?

The SPY (S&P 500 / C-fund) fell below some key levels temporarily on Thursday but buyers stepped up and it is back above the 20 and 50-day EMA's, as well as the longer-term rising support line. But Thursday's brief breakdown was not very comfortable for the bulls.


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

The Wilshire 4500 (S-fund) is still lagging and is well below Wednesday's closing price. This is either a bearish sign for the rest of the market, or it will catch up early this week if investors are back on the bullish bandwagon. Often times the big "safer" stocks are the first bought when the market bottoms, then the riskier investments are grabbed next.


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

The Russell 2000 small cap Index does have that pattern of sharp sell-offs followed but minor rebounds, which are then followed by sharp rallies.


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

The Dow Transportation Index found support around that 8600 level and 200-day EMA we've been watching, and the possible head and shoulder theory that we've talked about continues to unfold as it looks like a right shoulder may start to form. Once the right shoulder is peaking, we'll have to revisit the possibility of another test of the neckline near 8600.


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

The EFA (EAFE index / I-fund) was up 1.11% on Friday, but as I talked about above, the I-fund wasn't showing the love and the TSP went with Friday's actual EAFE index result of -0.28%. That could mean a big day for the I-fund today as they always have to catch up.


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

The dollar remains in a new downtrend. There's an open gap above but there's also a bear flag forming. The top of that gap could be tough resistance to get through.


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

The short-term indicators have curled back up...


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

The AGG (bonds / F-fund) is tumbling but it may be a little oversold in the short-term. I am avoiding the F-fund unless it's for just very short term trades, but most likely no F for me until this improves.


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


Read more in today's TSP Talk Plus Report. We post more charts, indicators and analysis, plus discuss the Sentiment Survey Results and the allocations of the TSP and ETF Systems. For more information on how to gain access and a list of the benefits of being a subscriber, please go to: www.tsptalk.com/plus.php

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.