TSP Talk Blog

Stocks opened lower on Thursday and the bulls made several attempts to take the indices higher, but the bears weren't far behind selling the intraday rallies. The bulls won the battle as the Dow ended the day up 80-points, but the bears were able to erase an earlier 150-point gain. New York Fed President William Dudley said that tighter financial conditions could weigh on the Federal Reserve's decision to move forward with its plan to normalize rates. Is that good or bad? It doesn't seem like investors know yet.

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The price of oil was all over the place on Thursday and the stock market seems to be losing its grip on the coupling between the two. The way the dollar has moved recently, it may be having more of an impact on oil so perhaps stocks will start looking at the dollar as the catalyst.



This morning (Friday) we get the January jobs report and estimates are looking for a gain of 188,000 jobs, and an unemployment rate of 5.0%. The Jobs Report Contest winner will be posted here.

The SPY (S&P 500 Index / C-Fund) was up slightly and continues to try to hang onto the "V" bottom formation despite some scares. The 20-day EMA is being tested again.




The Dow Completion Index (small caps / S-Fund) closed off the highs but it held up enough to remain in the bear flag - although still below the 20-day EMA.




The Dow Transportation Index had a very big day, but it was only enough to push to the top of the bear flag.




The EFA (EAFE Index / I-fund) filled a small gap after rallying modestly yesterday.




The dollar is back on the radar after it dropped precipitously over the last two days. It closed below the 200-day EMA for the first time since October.




The AGG (Bonds / F-fund) seems to have legitimately broken out and now that rising support line has some strength to it. The weak economic data that sent the dollar down was telegraphed by the lower bond yields (high bond prices) all week. It is starting to sound like a recession is being priced in here.



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. Have a great weekend!

Tom Crowley


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