We saw a lot of bouncing back and forth early on Friday but some positive comments from President Trump regarding China and trade helped spark an early afternoon rally that mostly held into the close. There seems to be a lot of indecision out there with these big intraday swings as a battle ensues between the bulls who are looking for a relief rally this holiday week, and the bears who are still selling the rallies.
Seasonality gets very positive on Wednesday and Friday of this week, with Thursday being Thanksgiving Day, of course. Trading volume may be lighter that that doesn't mean volatility will be lighter. As a matter of fact lighter volume can trigger volatility because big orders can really push the indices around.
I am going to make this quick today as I had some personal obligations to take care of over the weekend and into Monday. Our TSP Talk Plus subscribers got this week's new system signals so we have our plan of
attack. Now let's hope the plan comes together.
The S&P 500 / C-fund has bounced nicely off the lows but it is about to run into that 200-day EMA again. The holiday could help break that resistance since the bears are usually more apt to stay away during holidays, but they'll be ready to pounce again after the holiday if the bulls are not ready.
The DWCPF (S-fund) rallied for a couple of days since filling that open gap. It may try to create another "V" low but without a decent move it could easily turn into a bear flag.
The Dow Transpiration Index has been stalling at the 50 and 200-day EMAs over the last couple of days. The bulls may get an opportunity to break above that inverted head and shoulders pattern if the bears are hibernating this week but I'll be more interested in the action after the holiday when the positive bias has passed.
The EAFE Index / I-fund was up nicely with the help of a pullback in the dollar on Friday.
The High Yield Corporate Bonds were down early but bounced back with stocks and it put in back-to-back lows, similar to a couple of other short-term lows in recent weeks.
The AGG (bonds / F-fund) had another nice day on Friday and it was able to move back above that stubborn 50-day EMA, so that's about 3 layers of resistance it made it through last week.
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