TSP Talk Blog

Stocks opened higher on Friday after Thursday's positive reversal day. The indices couldn't really hold the opening prices as the Dow closed slightly lower on the day while the S&P gave up about half of its early gains. The Nasdaq and small caps led the way while bonds pulled back.

Daily TSP Funds Return More returns

The I-fund, which lagged badly in 2016, has outpaced the U.S. indices so far this year, and much of that has to do with a pullback in the dollar. As you will see below, the dollar has cracked a bit but it is trying to hold on at the 50-day EMA right now.


The SPY (S&P 500 / C-fund) has been finding resistance while trying to push to new highs recently. Chart formation-wise, this still looks pretty good, but the move off the November lows is still substantial and it wouldn't be out of the question to see stocks consolidate more, or even pullback before pushing to new highs. It has been digesting those gains since mid-December and the question is whether it has been enough to produce a breakout.




The weekly chart still looks good but as we've been saying, the path of least resistance appears to be the downside but the S&P has been able to hang around the top of the rising channel for some time now.




The DWCPF (S-fund) looks very good with a big bullish flag fully formed, but like the S&P, it has come a long way in the last two months. The highs actually came over a month ago so perhaps it is getting ready to make another leg higher. Eventually it will test the 50-day EMA but the question is whether it will pullback to do so, or if it will continue to move sideways to allow the 50-day EMA to move up to the index.




The Dow Transportation chart has improved greatly in the last week after breaking above the descending trading channel and moving back above the 20-day EMA.




The EFA (I-fund) has been the leader this year after lagging badly last year. It hit a new multi-month high on Friday, but a lot of that has to do with the price of the dollar which is looking to find support now.




Here is that chart of the dollar which soared to end 2016, holding the I-fund back, but since the New Year started the dollar has been pulling back.





The AGG (bonds / F-fund) pulled back on Friday and dipped back below the 50-day EMA. It still remains in a rising channel but so far that 200-day EMA has held during this relief rally. That's something we'd expect in this bear market in bonds.




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. 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.