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Flat to slightly higher, but new records for the big 3

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There was a noticeable fade in afternoon trading, but that didn't stop many of the major stock indices from closing at record levels once again. The Dow gained another 20-points on the day while the S&P and Nasdaq were also up slightly. No signs of the bears who are either being patient, or non-existent.

Daily TSP Funds Return

The small caps and Transports, which have been leading this recent charge higher in the stock market, took a little break on Wednesday after remarkable runs. The Transports posted a negative reversal day so we'll keep an eye on that as a possible negative clue from the market leader.

Investors are trying to get in front of any change in tax policy so tax reform is a must in DC at this point, or we could see a major let down. Even if we do get a bill signed, the questions will arise about whether the deal is already priced in.

This is starting to remind me of the Dot Com days when it was buy first, ask questions later, but the difference was that it was a lot more volatile back then with big moves up, but also large pullbacks and corrections in there too.

This coming Friday we get the September jobs report and estimates are fairly wide with a consensus of a gain of just 75,000 jobs and an unemployment rate of 4.4%.

I have a pretty full plate this week so I'm keeping things on the brief side and I may be delayed in responding to emails. I apologize in advance for any inconveniences.

Administrative Note: It has come to our attention that some agencies / branches of the military (most recently the Navy) are blocking TSP Talk. We've seen this before and sometimes there is something you can do about it. If you are in the Navy and having this issue, one of your members sent me this form that can be filled out and emailed to the address on the form. I think if they get enough requests they will reconsider. (Download Exception-Request-Form Word Doc ) Other branches should have their own exemption form which you can probably get online. Thank you!

The SPY (S&P 500 / C-fund) was up yet again and the bulls remain in charge. That's another 6 days in a row of gains and clearly this is stretched, but there's no laws against it continuing higher, except for maybe the law of gravity.

The DWCPF (S-fund) was down slightly on the day as it took a much needed break. Still the bears could not muster any pressure and it closed basically flat. A new spinning top candlestick formation was created, and they can be signs of impending reversals, but the last time we saw one it did the opposite and shot up in the following days.

The Dow Transportation Index has been on fire but yesterday's action may be showing a change in momentum. Recent declines only lasted two or three days so is this a coming short-term opportunity, or will we finally see some kind of meaningful pullback?

The EAFE Index (I-fund) is having a fabulous year, with some help from the dollar earlier in the year, but more recent strong performances from the European stock markets.

The AGG (Bonds / F-fund) tried to rally but hit the 20-day EMA and started to back off again. It is in that bear flag but the open gap above 109.60 may still be a draw. There are two other open gaps above.

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:

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

Tom Crowley

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S&P 500 (C Fund)
DWCPF (S Fund)
Dow Jones U.S. Completion Total Stock Market Index (^DWCPF)
EFA (I Fund)
iShares MSCI EAFE Index (EFA)
AGG (F Fund)
iShares Lehman Aggregate Bond (AGG)