TSP Talk Blog

Stocks opened lower on Wednesday and spent most of the day with minor losses before falling more sharply in the final hour of trading. The Dow ended the day down 117-points as the stock market continues to follow the lead of the price of oil, which lost over 1% on the day.

Per TSP.gov: "Some financial markets will be closed on Friday, January 1st in observance of the New Year's Day holiday. The Thrift Savings Plan will also be closed. Transactions that would have been processed Friday night (January 1st) will be processed Monday night (January 4th), at Monday's closing share prices."

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Today is trading day #22 in December, and since December has 22 trading days this year and the chart below only accounts for 21 days, we're looking at the final trading of the month - day # 21 on the chart. It historically is just above random, but in more recent years it has been less positive. The January chart below shows the 1st trading day in January being on the negative side, but day #2 is quite positive historically.



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

The SPY (S&P 500 / C-Fund) pulled back to try to fill the gap it opened on Tuesday. It did close above the old descending resistance line for a second day, and also remains above the 50-day EMA. If those can hold through the first couple days of the New Year, that would be a big positive. Otherwise a new lower low will be formed, and that could be trouble.

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

The Dow Completion Index (small caps / S-Fund) continues to underperform and was pushed back from the 50-day EMA. The rising wedge pattern looks ominous, but you never know how a New Year is going to start.


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

The price of oil reversed back down after Tuesday's rally. The stock market has it's thumb on the pulse of oil looking for direction. I don't know how much lower oil can go in 2016, but it seems to be getting a little overdone on the downside. Perhaps one more capitulation sell-off can trigger a bottom? We'll see.


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

The EFA (EAFE Index / I-fund) was down 0.60% on Wednesday but closed above the 50-day EMA for a second straight day. There is overhead resistance in the form of a descending trend line, and the top of a bearish rising wedge pattern.


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

The AGG (Bonds / F-Fund) broke below support and this time closed below it. The F-fund had a small gain on Wednesday but some of that was making up for excess loss the F-fund took on Tuesday.


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 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. Happy New Year and have a great weekend!

Tom Crowley


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