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A breakout of sorts

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It was big day for stocks with the Dow leading the way gaining 1.4% on the day while the broader indices gained about half of that, but that is still a solid day for stocks. The Financials played a little catch up as bond yields rallied, and that helped the large banks push the Dow higher.

Daily TSP Funds Return
Ironically the market leading FAANG stocks struggled yesterday with 3 of the 5 closing down and the other two posting just small gains, so for the first time in a while it was not the Nasdaq that led.

Yields shot back up yesterday with the 10-year Treasury closing back in on 3.0% ...




That helped the financial stocks rally - finally filling that open gap on the XLF and moving back above the 50-day EMA.




Oil was down on the day, reversing Tuesday's gains and closing at the lowest level in about 8-weeks.

Shades of 2017 were hovering over the market as once again I find myself on the wrong side of a market that seems overly extended. The dumb money is not complaining however, and I would normally say that's a warning sign, but they sure did well in 2017, so what do I know? Of course 2017 was an anomalous year.

The Japanese Prime Minister is visiting the White House again and I'm sure trade, tariffs, and North Korea will be on the docket so that could make some headlines.

Next week we should be getting the next rate hike from the Fed after next Wednesday's FOMC meeting.

I'm going to be in and out of the office over the next couple of weeks, doing some traveling, and may not be posting full reports during that time. I will always check in with something everyday, as I have done for the last 14+ years, because I hate to leave our readers high and dry. I have some charts to show you below but also, here's some info from the TSP that may be of some interest to you...

The Thrift Saving Plan has provided some FAQs on the TSP Modernization Act and new Withdrawal Options, and you can find that by clicking here.




The S&P 500 / C-fund made a bold move yesterday as it pushed through that open gap from March, an area I wrongly thought would provide resistance. I also said yesterday that if it does climb above that gap, "it could be a strong rally", and that's because a lot of investors were waiting to see if that level could be taken out, so we saw a lot of sheep hoping over that fence.




The S-fund is making new highs pushing past all resistance levels, but also getting a little extended here.




The Dow Transportation Index was up and held within its "F" flag, but it closed below the March and April highs for a 3rd straight day.




The AGG (Bonds / F-fund) was down sharply as the pullback from the May rally continues, and the open gaps get filled one by one.




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 www.tsptalk.com/comments.php


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.

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S&P 500 (C Fund)
S&P 500 INDEX,RTH (^GSPC)
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)
Source: https://finance.google.com/finance