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S&P holds at new highs

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Stocks opened higher on Friday and closed near the highs, but in between it was a lot of tentative trading with the indices battling the break-even line. The Dow ended the day up 20-points despite being in negative territory for much of the day. The S&P 500 made a new all-time high and closed at a new high as well.

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The I-fund led the stock funds again as the dollar continues to slide. Bonds were up nicely.

The SPY (S&P500 / C-fund) showed some positive signs on Friday, not only because it gained 0.11% but it closed above the breakout line for the second straight day. All of the prior breakout attempts only saw one close above the line before they broke back down below that resistance line.



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

The weekly chart of the S&P 500 Index continues to test and find support at the lower end of the long-term rising trading channel. You can see that nearly every week since early March has tested that rising support line. Will it finally break that trend and move higher without testing the line this week, or will the market continue to trade in a very tight range with the current levels being the top of that range?


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


The Wilshire 4500 (S-fund) is continuing to rebound off of the longer-term rising support line. We were a little concerned that there was a bear flag forming but keep an eye on the 1105 area near the 20-day EMA. If that that old resistance can now hold as support, the upside may be the path of least resistance for the small caps. But that's a big if.


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


The
Dow Transportation Index looks to have complete the head and shoulders pattern and now it need to make up its mind whether it will break down or up from the pattern. Having rebounded off of the point F low where support in the 8550-8600 area has been strong, we may find out today if it wants to reach out to point G and complete the near mirror image of the H&S alive.


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


The
EFA (EAFE index / I-fund) held for a second day above the old resistance line. It lasted 2 days back in April before pulling back.


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

After hitting 68.48 on Friday, it is now about 2-points away from a new high. It's been quite a run since the January lows.


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


The weak dollar has been a big catalyst for the I-fund and other than the open gaps that may want to get filled, this still looks rather bearish.


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


The AGG (bonds / F-fund) rallied sharply on Friday after being very oversold. It filled an open gap near 110.25 but created a new open gap down near 109.75. This could be a turning point for bonds, but right now it remains in a downtrend.


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



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

Tom Crowley



Posted daily at www.tsptalk.com/comments.php

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.

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