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Another day, another reversal

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The day traders are probably having a field day betting against any move away from break-even for last couple of weeks as we saw yet another reversal day. Yesterday was another day where the Dow saw a big early move, only to have it snap back to almost where it started. The 148-point decline on Tuesday morning turned into a 7-point loss by the close, and the non-day trading analyst are all in waiting mode, anticipating the next move that will actually hold.

Daily TSP Funds Return

Bonds had a good day, but moved right up to resistance again. The Volatility Index hit its highest point since pre-election. Add another big rally in gold and you would think that stocks are selling off, but they are not. Is it a warning sign for stocks or are they showing strength in the face of these warnings? Meanwhile the more "risky" / aggressive small caps had a strong day. Very interesting action.

Friday is not a federal holiday but it is Good Friday and the stock market and TSP will be closed so we will take the day off. This chart is on the old side but it shows that just before and after the holiday weekend that stocks tend to do well.




Per www.tsp.gov: "Some financial markets will be closed on Friday, April 14th in observance of Good Friday. Consequently, the Thrift Savings Plan will not be updating share prices in any of the TSP funds for that day. Transactions that would have been processed Friday night (April 14th) will be processed Monday night (April 17th), at Monday's closing share prices."


The SPY (S&P 500 / C-fund) dipped sharply on Tuesday morning, hit the 50-day EMA and the rising support line, and rallied into the close to post a small loss. This will breakout eventually but who knows when? There is a 3-point (1.3%) range between the top and bottom of the current pennant formation, which is obviously shrinking.




The DWCPF (S-fund) had a strong day closing above the 50-day EMA for a 4th straight day. Yes it is still range-bound so the 50-day EMA may not be as meaningful, but many traders and investors watch that EMA and it could be a self-fulfilling bullish prophesy for those waiting for that kind of confirmation.




The Dow Transportation Index lagged with a 0.47% loss yesterday but it came back from steep early losses helping define that flag formation that we have been watching as it floats between an F flag and a bull flag. It did fall back below the 50-day EMA after just one day above it, but the positive reversal day bodes well for Wednesday.




The EFA (I-fund) got a nice bounce off the bottom on its trading channel on Tuesday, thanks to another dip in the dollar. That's an outside positive reversal while hitting some weak overhead resistance.




The AGG (Bonds / F-fund) rallied up to resistance again and has some work to do to move higher. The geopolitical events are certainly having their impact on investors as they look for some safety even though they are not really selling stocks with any aggression.




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' see you back here tomorrow.

Tom Crowley


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

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S&P500 (C Fund) (delayed)

(Stockcharts.com Real-time)
DWCPF (S Fund) (delayed)

(Stockcharts.com Real-time)
EFA (I Fund) (delayed)

(Stockcharts.com Real-time)
BND (F Fund) (delayed)

(Stockcharts.com Real-time)

Yahoo Finance Realtime TSP Fund Tracking Index Quotes