TSP Talk Blog

It was another slow, slightly negative day for stocks on Tuesday with more selling in the last hour of trading, something we have not been used to this year. That was 3 weak closes in the last four trading days so there may be a bit of a change in character developing in the market. Still, 2 or 3 day pullbacks are healthy, and even more is fine as long as support is holding. The Dow lost 30-points.

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Trading volume has backed off some this week as the FOMC meeting and potential / very possible rate hike nears - as does the debt ceiling deadline. You can hardy blame investors for starting to ring the register from the 2017 rally.

The February jobs report comes out on Friday and estimates are looking for a gain of 188,000 jobs and an unemployment rate of 4.7%

The SPY (S&P 500 / C-fund) pulled back slightly yesterday as it closed just below the bottom of the gap from last week. You can see that the 20 and 50-day EMA's are still well below the current levels and pulling back to test those is certainly not a bull market breaker. If anything it could be just what the doctor order for another attempt at new highs in the weeks ahead.




The DWCPF (S-fund) has closed below the 20-day EMA for a second day after falling below a couple of support lines (one being the top of the of the 3-month long trading channel.) Some cracks are developing here but it's still above the 50-day EMA.




The Dow Transportation Index is close to testing its 50-day EMA after it also fell below its old resistance line and a short-term rising support line. A move below the 9100 would be a major crack but so far its just minor stuff.




The EFA (I-fund) has been hovering near recent highs but below that wedge pattern that has become resistance.




The AGG (bonds / F-fund) was down slightly again on Tuesday as it closed below the 50-day EMA for a 5th straight day. So far the open gap has not drawn any attention so this looks a little bearish for bonds, although I will not rule out seeing that gap get filled unless this really starts to break down from here.




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

Tom Crowley


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